2007-03-29 01:20:38 · 8 answers · asked by qwert p 1 in Business & Finance ➔ Investing
Profit-booking is nothing but encashing or realising the profit or gain in a share by selling it.
For example
In the market you buy a stock or share say
at Rs.150.
You are holding it for more than 2 months. Now its quoted at, lets say... Rs.320
The market has been bullish and you expect the trend to continue.
So you hold on to the stock. Another week goes.
The quote rises from Rs.320 to Rs.325.
No doubt the stock is .... still bullish or ... on the rise.
But dont yuou see that there is a slow down in the rise.
Yes this is the time to think seriously ....
and Sell the stock and take the profit
... this is called profit-booking, wheterh done by individuals or by big operators or by brokers.
The profit-booking normally brings the bull run to a halt or to a near halt.
those who sense it in advance and book the gain immediately are the ones who will get maximum profit.
Again, there is no hard and fast rule.
market is always irriational .. as it had .. so far proved to be.
But
what ever it is
as long you stand to gain (gain is more than the notional bank interest on the investment)
You ....... have ....... no ....... reason ...... to be .... unhappy.
!!!
2007-03-29 07:03:36 · answer #1 · answered by surez 3 · 0⤊ 0⤋
It is nothing but encashing the profits on investments in stock markets.
If you have purchased shares and the rate has moved favourabe i.e. you are in profits, sell the shares and take home the capital + profits.
It is always advisable to book atleast partial profits every now and then.
2007-03-30 01:50:39 · answer #2 · answered by Nitin G 7 · 0⤊ 0⤋
When we start selling the shares continuosly at the higher index price, that is called profit booking, profit booking leads falling of market.
2007-03-29 08:31:20 · answer #3 · answered by AVANISH JI 5 · 2⤊ 0⤋
profit booking means booking profit.
if you bought the shares at rs.100, and after 6 months, the share was selling at rs. 150. you may sell fully or partly, to gain profit. this is called profit booking
2007-03-30 08:24:12 · answer #4 · answered by sarjan 3 · 0⤊ 0⤋
profit booking leads falling of market.
2007-03-29 08:49:29 · answer #5 · answered by dinesh j 2 · 0⤊ 0⤋
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2007-03-30 09:03:34 · answer #6 · answered by Anonymous · 0⤊ 0⤋
selling ur stocks when its price rises (ie when the index is up)
2007-03-29 13:07:19 · answer #7 · answered by sushobhan 6 · 0⤊ 0⤋
selling shares at higher price than you bought....
well..its also an indication that its goingot crash
Chris
www.forexaim.com
2007-03-29 09:09:18 · answer #8 · answered by Anonymous · 0⤊ 0⤋