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Take a Stair-Step Approach to Selling

by Stuart Chaussee

In a bull market, your goal should be to capture as much of the profits in your stocks as possible. That means selling them before they start to decline. Chances are, your individual stocks will rise or decline along with the broader averages. If you concentrate your buys at a time when the stocks on your watch list are just starting to break out on heavy volume from a support level or base pattern (sideways), you'll increase your chances of making money compared to sitting in a stock that's going nowhere or declining. Again, a heavy-volume breakout in any stock (dividend-paying or not) is a sign that institutional investors are scooping up shares -- a particularly good sign after a correction or fairly lengthy sideways pattern in a stock. These stock patterns have emerged often lately -- from the initial surge in the broader averages just before the...

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