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Taking Profits

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taking profits

Taking Profits
The act of selling a large quantity of security immediately after it has spiked in price such that the seller will realize a great deal of capital appreciation. For example, if one buys a security at $5 and it suddenly rises to $35, the investor sells the security. If enough investors do this, it can cause a significant, but temporary, drop in price. However, technical analysts see it as a signal of an uptrend. It is also called profit taking.


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