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Sticking To The Rules

Yesterday I grabbed 200 dollars in profits from first layer trading technique.

I could have made more.

I got emotional.

So, layer one in my portfolio is active trading... The rule is basically that I monitor the upper and lower bollinger bands of the stock price moment on Realty Income Corp.  I buy when it hits the lower band on the 1 month time frame... I sell when it hits the upper, contingent upon the shares being in the profit.

This happened yesterday.

Here's the thing though... I stopped buying after my 3rd lot of 100 shares.  Yesterday I sold out of all 300 shares and took a 200 dollar profit.

I could have made quite a bit more... Had I bought 200 MORE shares on 2 more bottom hits.

I didn't.  I got emotional and held my ground not buying.

I think, had I bought, I would have made a good 300 more for 500 total.

I also sold off a little early.

The thing is.... This is why I am pretty confident about this technique..

Even on a sloppy emotional not even all in trade... I still made 200 bucks.

Not bad as far as I'm concerned.

The other thing about it is that it offers trade protection.

See, the other day... There was an issue where I couldn't even look at my stuff...

Sometimes... Life will get in the way, and it will be hard to even tend to the trades... With my layered trading technique... Even if I miss a trade... Who cares?

I'm still pretty set.

Layer one with Realty Income Corp is always a buy and hold until I make profit... Even if I miss an upswing and hold still... And it goes back down... Who cares... I still get that monthly dividend.

And since I am basically trading in, in chunks of shares... I can always spot a new bottom and try to take a quick profit in a swing trade.

Of course layer 2 is dividend growth long term holds, so those are just dividends coming in off of holding stocks for the long run, which requires no logging in because once I buy it... I hold it forever.

Same with layer 3...

The thing with those layers is I could get emotional with those too...

So, the rule for layer 2 and 3 is, buy in... At 100 percent profit, sell half and diversify out into something new.

I'm trying to fan out horizontally instead of grow vertically...

A lot of people like to keep their portfolios vertical... As in they only how a small number of stocks that are at big gains.

I plan to grow my portfolio out horizontally... So, a large number of stocks all at very small gains.

And then layer 4 and 5 are different because they are super risky holdings... So, those are more like... Throw things at the wall and see what sticks type of deal, take the winnings and run.

But... The name of the game is to stay unemotional and keep to the rule.

I saw this in my layer 1 holding when I didn't do that and missed out on 300 bucks.

As the price went lower, I couldn't buy.  I just held out... Then when it finally turns around... If I had stuck with the rule, I would have bought almost near bottom, and then watched it ride all the way back beyond my original purchase price.... before turning back around.

Don't get emotional, stick to the rules.  The same could be said about jobs... Relationships... Or pretty much any life circumstance...

It's hard not to get emotional obviously, because that's what we do as people... But, just form a plan, and try to stick to it.

And trust the plan.  I think that's what I got out of this... I formed a plan... And I got a little scared and didn't stick to it.

Had I done that, it would have done exactly what I wanted it to do...

Make a plan... And stick to it.

That's what I'm trying to get out of this.  Lesson learned.