Building a Position
At what price to buy and when to buy is probably the hardest questions to answer for any investor. I believe that when you find a stock you want to buy and believe their is upside potential, the first question should be how many shares do I want to own. Keep in mind this is not for daytrading.
Once you have determined the number of shares you want, I suggest you buy the stock over a period of a few days. Some of my biggest wins have been through building large positions over 1-2 weeks. I only buy big positions in very solid companies. This slow buying with help you average your price and keep you from feeling like you missed the bottom.
The same can be said for selling a position. It’s impossible to guess a bottom or top so when you decide to sell, I suggest you sell 1/4 of your position at a time depending on how large your position is. Sometimes when a stock is not very liquid, selling may cause the price to drop. In this case you will have to offer your shares on the ask and wait for someone to buy into it.
