Selling stocks takes skill just as well as trying to decide which stocks to buy for potential profit. There’s is a right time and a wrong time to sell a stock. Experienced stock traders know how to find the right time to sell stocks effectively. Here are some of the different selling conditions that stock traders may consider.

Selling At A Certain Value Level

Some stock traders may determine the right time to sell stocks based upon reaching a certain value level or range. This technique is called as the valuation-level sell. Stock traders may use different valuation metrics as their basis for this. Some of the most common valuation metrics used are the price-to-earnings (P/E), price-to-sales (P/S) and the price-to-book (P/B) ratios. This approach is usually used for stocks that are undervalued.

Selling When Fundamentals Fall

Some traders may sell stocks when a certain company is showing deteriorating fundamentals as can be seen on their financial statements. This strategy is called as the deteriorating fundamentals sell. Traders who use this strategy usually focus on the company’s balance sheet statement and emphasize on the stock’s liquidity and their coverage ratios.

Selling At A Certain Gain Or Loss Level

There are also others who make use of a strategy to sell upon reaching a certain level of gains or loss. This strategy is called as the down-from cost sell for falling stocks or up-from-cost sell for rising stocks. It is essentially a stop-loss measure that help protect the investor’s loss or gains from a certain stock.

Selling When A Better Opportunity Comes

Another stock selling strategy used may be based on the opportunity made available in the market. Essentially called as the opportunity cost sell, the investor or trader may sell a stock or a certain stock portfolio whenever a better opportunity presents itself in the market. This type of selling strategy may highly depend on constant monitoring, analysis and research of one’s stock portfolio as well as stocks available in the market.

Selling At A Target Price

Another strategy used for selling stocks may be based at a certain target price. Called as the target price sell, this strategy is simply based on a stock reaching a target price in order to trigger a sell-off. This strategy is one of the widely used ways by traders and investors to sell their stocks.