Understanding the Stock Picks

Do the stock pick details look confusing to you? Don't worry! This page explains them. You'll get the hang of them in no time.

Ticker

This is the symbol of the stock I'm buying. Typically it's 4 letters long (like TSLA for Tesla). Sometimes it's just one letter (like C for Citigroup). Just punch the ticker into your trading platform to bring it up.

Price

This is the price I paid for my entry. Even though I will post the trade immediately when I place it, the price will probably have changed to at least some degree by the time you see it. That's ok!

The positions I take are typically held for about a week. If the price moves by a little bit before you get to it, that's ok. It's probably not going to make or break the trade if it's just a little bit different. Most likely, by the time you get the alert, about half the time it will be up a little bit and half the time it will be down a little bit. One option for you is to just get in immediately regardless what the price is when you get there.

And in some cases, it works out to your benefit! If I post a stock pick saying I bought Apple stock at 300.00 with a stoploss at 295.00, and by the time you see it the price has gone down to 299.00, then it means you have the opportunity to buy it for a better price than me. So you'll either get even more profit than me if you buy it and it hits the profit target, or you'll lose less than me if it hits the stoploss.

As far as placing the actual trade, for any given ticker there is a "bid" and "ask" price at any given time:

• If you are trying to buy a stock, you can buy it at "market", which means you will basically pay the "ask" price. It's possible you could get it for a little bit cheaper, but buying at market gets you in the trade without the price taking off and leaving you behind. And for these trades I make, we're looking for a bit bigger movements, so giving up a few cents to make sure you get into the trade isn't likely to have a massive impact.



• If you want to try to get a price lower than the ask price, then you can do a "limit order" which means you name the price you're willing to pay for it and it doesn't get filled unless it's at your specified price or better. Sometimes this pays off and you get an even better price than the ask. And sometimes you miss the opportunity altogether because you waited for it to go lower but it never did.

One other option you have is to place a limit order at the exact price I alerted. That means you'll always get at least the price I paid or better. But it also means you'll miss some trades because the price will never come back down to your order limit.

Ultimately, you have to decide for yourself whether to trade my stock pick or not. I can't decide that for you since I'm not a certified financial advisor. I'm just telling you when I'm making a trade and then you use your own judgment whether you want to follow suit, based on the price you see, your risk preference, and any other factors you want to consider.

Profit Target and Stoploss

Every time I do a trade, I already know up front what my profit target and stoploss will be. The profit target is the price where I will get out and lock in my profit. The stoploss is the price where I will get out and lock in the loss.

This means that if you decide to trade one of my stock picks, you can immediately set the profit target and stoploss. I have a few pieces of input about this:

• I make absolutely sure to stick to the plan. I don't move stoplosses down EVER. I've seen cases where peoples' entire accounts get destroyed on one trade because they keep moving the stoploss further and further down. If you set the stoploss up front and leave it alone, you are controlling your risk. This is a HUGE deal. I can't stress it enough.


• I set my profit exit orders as "GTC". This means that they stay in force until I cancel them. For some trading platforms, the default order setting is "Day", which means the order is only valid until the end of the day. If you set the exit orders that way, then they'll be gone by the next day and you'd have to set them all over again. I have my default order type set to GTC at all times.


• I like to set my profit exit and stoploss with something called an OCO order. That stands for "one cancels the other". It basically links the two exit orders together. That way if, for example, my profit target gets hit, then the stoploss order automatically get canceled.

Time Limits on Trades

Many of my stock picks have a time limit. By that, I mean that they say something like "Closing by 11/26/20."

When a time limit is indicated, I'll be selling any open positions at "Market" first thing in the morning on the date indicated.

If a time limit isn't indicated in the stock pick posting, then I will be holding the position until it hits either the profit target or stoploss no matter how long it takes.

It's a lot of information to take in at first. But once you get in a rhythm with it, then it will likely seem very basic and easy. It's a repeatable process.

If you have any questions, contact me. I'll be ready to help!