winkler7224 Sep 2009 22:06
erm...my philosophy is no company can ever do good all the time. we can only research so much as to predict/forecast if any bad news could be coming. so when the chance exists, one should always try to bank-in whatever profits from an invested share.
i buy my shares in 2 blocks - 1st block is the original amount of shares i intend to hold for the long term(i.e. a "base holding"), the 2nd block is for "riding" the share price as it goes up and down - buy low, sell high, then buy back low again, sell high, etc. in that way, i make back as much as i can for the money i've spent on the base holding. whenever i sell the 2nd block, that is called top slicing. but do this only for companies you totally trust, especially if there are plenty of positive indicators.
for example, buy 10,000 shares of TSW. when the price goes up(especially if it "spikes" for no reason), sell 5000 shares then hope it goes back down. if it doesn't then oh well, at least your 5000 shares now cost less because you've "top sliced". if it does go back below your sell price, buy back in and wait for the next rise. this is where L2 info comes handy because you get to see a lot more information rather than just "guessing". i don't have L2 info because i have a full time job and i am not a full time trader. but i will be voluntarily jobless soon so...perhaps i may subscribe to L2 info service soon.
hope that helps - there are other strategies too but i gue