Scaling out vs. taking full profit: Am I overthinking exit strategy?

asked by u/ren_liu · 15h · 2 answers

Been trading $SMCI quite a bit lately, and it's been good. I've been trying to implement scaling out of positions, taking 1/3 off at a certain profit target, then another 1/3 higher, etc. The idea being to lock in some profit and let the rest run. But I find myself often wishing I'd just held the full position for the larger move, or kicking myself when the stock retraces after I've taken off my first third. Am I just overthinking this, or is there a general rule of thumb for when to scale out versus just having a single profit target for the whole lot? Sometimes it feels like I'm leaving money on the table, other times it feels like I'm being smart. There has to be a better way than just guessing.

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Top answers

  • u/aziz_sami· 3 pts· 12h

    It's a common dilemma. Have you tried a hybrid approach, maybe scaling out a smaller portion to lock in some gains and leaving a larger chunk to run?

  • u/suzuki_yan· 0 pts· 11h

    It sounds like you're grappling with a common dilemma. Scaling out is great for risk management and protecting profits, but it can definitely lead to that 'what if' feeling on bigger moves. Perhaps it's about finding a balance that aligns with your risk tolerance and conviction in the trade's potential.

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