By Mark Thomas
Trading decisions to take some profits are very hard to make when a market starts trading up so rapidly as silver is. However, go back and look at the move we have had in silver, a 9% rise last week all occurring in just two days last Thursday and Friday. It then went up again today currently 1.26%. Silver has now gone up 23.4% since the low of just one month ago. That is a very huge move and borders on now becoming irrational. However because this has turned into the perfect storm for our silver holdings and precious metals in general, I came into the situation positioned perfectly, I have taken a decent amount of profits and booked them.

I sold Tuesday morning on the open another 5% position of my ETFS Physical Shares Silver Trust now for a 12.5% percent gain and decied to go ahead and take another 5% position off after the open for an 11.79% gain. I also sold another 6% position on the open of Silver Wheaton (SLW) for a 9.31% gain.

I made a major decision to go ahead and right now take all my profits that I envisioned by the close tomorrow which would have been right ahead of options expiration this week. So I sold another 10% of my ETFS Physical Silver Shares Trust (SIVR) for an 11% gain and sold an additional 10% position in Silver Wheaton (SLW) for a quick 9.31% gain.

That now makes me just 50% invested overall and 50% in cash with over 72% of my gains for the year in the realized column. That is the lowest amount of my personal portfolio I have had invested in the silver market since the inception of this silver model portfolio last December. I just decided that my greed was starting to blind me to the facts of how large this move has been, how much hot money and fast traders are now entering silver and a sector darling like Silver Wheaton. I might be wrong but with such a powerful start to the year I think I will be content with whatever happens going forward.

Remember these tips for trading in silver and for trading any securities in general:

1. In the silver market, the trading is very volatile, so don’t make any all or none trades.

2. Do your buying and selling in a systematic non emotional way in smaller portions to capture the majority of the possible gains.
3. That will help you stay cool and not let the stress take a toll on you.

4. You will find that 9 out of 10 times it produces just as well as results with much less damages to your nerves.

5. It also will help strengthen your conviction about your investment thesis and confidence.

6. It can also help you realize you have made a mistake, help limit the damage and cut your loss.

7. One rule is I only average down once. If a position goes down after that, never add again to lower your cost. Wait and revaluate your reason for placing the trade. Don’t just blindly continue averaging down because you can go broke that way.

Courtesy: www.thesilvershortage.com