One way to control greed when trading is to have a stop-loss level & exit level planned. I always decide on a stop-loss level & stick to it. This practice has helped me time & again to limit my losses to a minimum in a falling market.
But on the other hand, I don’t plan an exit price. Having bought a share, I stand on the side lines & watch. It must be mentioned here that this staying power is possible because I only invest money that I can do without for some time, money that can be forgotten for a while.
I wait patiently & watch the magic Beanstalk grow. Let it grow up & up towards the heaven. But nothing, not even a magic Bean, can grow for- ever. A day will come when it stops & bends. That is the moment for me to sell. I sell when the slide begins.
To give a recent example, I entered HDFC @ 34.Waited. It went up to 70.Then turned back. On the way down I sold at 68.Hurrah! Profit!
A friend bought the same @ 38. He didn’t sell at 70, 69, 68, the train slowed down to 67, 65.6o. He got off at 60. Now the guy laments that he didn’t sell @ 70.Silly Billy doesn’t see the profit he made. Bought @ 38 & sold 60. He laments “Aiyo machan, I should have sold at 70.You see, I lost ten by selling at 60!” Lol!
Some people are never satisfied. This destroys not only their happiness but their self respect as well. Examples abound in our political arena these days. We should know when to quit!