Over the years, working as a stockbroker or as a professional trader, I have developed what I termed "Rules for Trading." These are 11 guidelines for increasing the profitability of your trading and helping you avoid common mistakes. A complete list of my "Rules for Trading" is available at the following location: http://www.sterlinginvestments.com/rules.htm Over the course of the last couple of months I have been writing about each of the Rules in the Sterling Weekly to further explain the reasoning behind each of the Rules. In last Friday's edition of the Prime Stock Newsletter I listed the Rules (and the links to the relevant articles in the Sterling Weekly) instead of the regular trading recommendations. I discovered I had written about Rules 2-6, but had forgotten to write about Rule # 1. I am going to cover the 1st Rule for Trading "Never Let a Profit Turn into a Loss!" this week, and then get back on track with the 7th Rule for Trading next week.

The 1st Rule for Trading "Never Let a Profit Turn into a Loss!" is harder to adhere to that it may seems. The reasoning behind the Rule is that many people get emotionally attached to a stock and expect them to move higher than they actually do. Then when they start to move back lower, they hold onto them expecting them to return to their previous highs and continue to hold onto them as they turn into losing positions. The other Rules are extensions of, or build upon this Rule. The other vary obvious problem that the 1st Rule is designed to eliminate, is that if you do not limit and control the level of your loosing trades, ie unprofitable, then a great deal of your profits will simply go towards bringing you back to break even on your overall trading profitability. If you can successfully avoid letting your profitable trades turn into loosing positions then your overall profitability will increase.

Sterling Investment Services is an investment research and money management firm publishing the Prime Stock Newsletter. The Prime Stock Newsletter is a daily comprehensive newsletter that is useful for investors and traders alike. Whether you are looking for short term trading opportunities ranging from day trading to a couple of weeks or if you looking to acquire a long term portfolio at smart entry points. Subscriptions a $30/month. a 3 DAY TRAIL SUBSCRIPTION IS ONLY $4.95 (more).

NEW FEATURE: In the late 90's and into early 2000 I published the Professional Trader's Newsletter, which featured four (4) trading recommendations daily, as well as my nightly review of all the various sector indices. It was from these four (4) recommendations I selected the one I liked the best, as the expanded recommendation for the Prime Stock Newsletter. I have decided to combine the two newsletter formats and add three additional trading recommendations to the Prime Stock Newsletter. The new Prime Stock Newsletter will continue to have a primary recommendation with expanded information and analysis, three additional trading recommendations (the new feature), and my list of stocks with patterns indicating they are moving either higher or lower.