This is one of the biggest confusions for me. When I started investing in Crypto 3 years back, my intention was to purchase some coins and hold them for the long term. I did not think much about how long I should be holding. Not just in the crypto world but even in the share market, it is hard to decide when we should be exiting.
Some people miss the opportunity to book profits and they end up in loss or even get the bought price again. It is very tricky to predict what would be the all-time high and when we should be exiting. We cannot always exist when it is an all-time high. Only a few people would be lucky to exist at an all-time high. Also, this is something that can happen naturally without them even knowing about this. But otherwise, nobody can plan about exiting at an all-time high.
Planning the exit
In my real world, I have met people who discuss a lot about their exit strategy. One interesting friend once told me that whatever investments he does, he always exits when he sees a 5% profit. He also mentioned that he never had a loss so as to say. If there is a 5% profit, he would exit and invest the profit on something else it seems. But if the investment is not doing well, then he told that he would wait long term until he sees that 5% profit.
I believe this planning will definitely work. But do we have all the patience to be able to do something like this? I honestly don't have that patience at all. Only in recent times, I was able to reap some profit by waiting patiently. I guess things were good because it is the bull run. Otherwise, I doubt if I would have had enough patience to be able to see some profits.
Entry is easy and exit is difficult
The first thing that we have to be clear about is that we shouldn't be having any emotions while trading. If we exit from something and surprisingly if that goes 10X from there, we have to be happy with what we got already. Worrying about not getting something is not going to help us. I strongly believe that we are supposed to get only what we deserve. If we exit from something and if it pumps big time, I guess we are just unlucky chaps that's all.
Sometimes it can be very easy to predict when we should be entering into something. There will actually be lots of FOMO going around making it easier for us to invest. But when it comes to exit, there will be lots of speculations. Sometimes some people are even triggered to sell their holdings with a huge loss as well. That's all because of false calls and wrong information. If we see a good profit already, I would say it is the best time to exit if we have a small fear about losing what we already see.
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