Sabrient Select Opportunity Virtual Portfolio
Harvest Partial Profits in TOL and HST
As I have discussed before, I am a proponent of "profit harvesting," in which you take partial trading profits in a position once it moves strongly in your direction. In general, for swing trades, I would look to bank some profits once a stock position has provided a 10% gain, and then again when the balance of the position has reached a 20% gain. Today, we have an opportunity to lock in more profits in short position TOL, and to book our first round of profits in HST.
After yesterday’s selloff and more weakness this morning, the price on TOL dipped to our second target of $16.20, which puts our short position at about a 20% profit from the original entry price of $20.24. (We already booked profits on 1/3 position last week.) So, I recommend buying back another 1/3 of the original short position at the current price or lower, if you can monitor it. This allows us to bank some nice partial profits while letting the final 1/3 of the short position ride in anticipation of even lower prices.
Also, let’s book profits on 1/3 of the initial short position on HST, which is hitting our first 10% profit target of $13.30.
Best Regards,
