I was locked in!
As you know from my last post, I had three sell signals: stocks, property and crypto. So, on the Monday morning I went to my trading account to close out my trades...... and I couldn't! The broker was unable to sell the investment trust shares that give me exposure to the worlds stocks. So I deleted that order. By the time I went to sell my property and crypto holdings, they had fallen so much that I felt that it didn't make sense to let them go, as I would quite likely be buying back at a higher price....
So what happened after that? Watch the video and find out! I am also going to implement a strategy that might help to prevent this situation occurring in the future..... What is this strategy? Watch the video and find out!
Trend-following is great - until it doesn't work! When there is a crash it often seems that everything crashes simultaneously, and very suddenly. It's difficult, if not impossible, to exit a holding at a reasonable price.
Furthermore, the psychology of trading kicks in, making one do the opposite of what, in retrospect, would have made sense. We tend to buy high and sell low..... but we should be buying low and selling high. What would help us do this and avoid the stress that financial trading decisions involve? Asset allocation and rebalancing may help us do this..... I'll talk more about this in another post. Make sure that you are on my email list!