People who often speculate in stocks are inevitably faced with this difficulty - the stock is trapped. This is something that many investors are afraid of, and in the face of this situation some people are helpless, and some will think of such a method. Some people who encounter this situation will take such a method, through multiple positions to quickly reduce the cost of the position, perhaps this is a way to save the speculator, but through these multiple positions to reduce the cost of the method sometimes may not be desirable. This is due to the different conditions and speculation based on the way to add positions to save themselves from the set of different final results. So how to determine whether you can take multiple positions to save yourself from this method? The following conditions must be met to speculate in stocks, and it should be noted that one of these conditions must be missing.
The first is the need to have enough money, not a little position to add a full position is set, the loss is not worth it. Secondly, the stock should have the potential to rise, if this is a delisted stock or a junk stock, then the stock will not have any future upside, the approach of adding positions many times will only make you lose a lot of money. Of course, the most important thing is that stockholders need to adjust their mindset, otherwise they can't hold the stock after adding to their positions. If an investor can meet these three conditions at the same time, then this way of adding positions will work, and if you are lucky, this way can also help the investor to get out quickly and turn the state of loss into a state of profit. If any of the conditions are not met, then do not easily use the method of covering the position to save yourself, this will only make your stock losses even greater!
When the stock is set up can not blindly add positions, blindly adding positions will only get deeper and deeper, and the loss is getting bigger and bigger. In addition, investors also need to have a keen sense of investment and be able to judge the trend of the stock they hold afterwards. If you can accurately judge whether the stock will continue to rise or fall, then you can also make the right decision with it. If you predict that your stock has no upside, then do not invest any more, at this point the money added to the position is the same as throwing it into the sea.
Summary Analysis
When you buy or sell stocks and get trapped, many people will choose to cover their positions to save themselves. If you lack a systematic method of covering positions, blindly covering positions will only make you deeper and deeper. To fill a position requires a certain technical judgment, you need to determine whether the ticket has stopped falling and whether the short-term or medium-term upward trend has changed. You need to clearly understand what stocks are worth covering and what stocks are not worth covering. Let's say: those stocks where the big trend has gone and the main force has withdrawn from the whole line are not worth covering
