How I Never Take Big Losses

Look at my Profit.ly chart:

25 years. More than 9,000 trades. Over $7.9 million in verified profits.

I’ve traded through some of the greatest bull runs (and some of the most brutal bear markets) in history.

But even during the dot-com bubble, the 2008 financial crisis, and the COVID-19 pandemic…

My performance stayed consistent.

Do you see any major drawdowns on my chart? Big dips? Long losing streaks?

No.

This leads to one of the most common questions students ask me:

“Tim, how does your profit chart look so smooth over so many years?”

The answer is almost too simple, obvious, and easy:

I cut losses quickly. 

You’ve heard me say it a thousand times…

“Cut losses quickly. Cut losses quickly. Cut losses quickly!”

But how do you know when to cut? Should you cut it all at once, or in pieces? And what signals can you rely on to signal it’s time to exit?

This is how I cut losses quickly.

When I Take Full Profits

Before I ever risk a single dollar, I already have a specific profit goal in mind.

It’s not an exact science. More of a range.

Think of it like Pirates of the Caribbean: “The code is more what you call guidelines than actual rules.”

That’s how I treat my profit targets.

When a stock hits or nears my goal, I’m already thinking about locking it in. I don’t wait for the reversal.

We trade volatile small caps and microcaps. These things turn fast.

Goooooooooood morning! Who's up early to watch and learn and earn from big premarket runners like $KZIA $SGBX $STEC which all sadly look like double/triple tops so far as there's no $OLMA type insane Supernova move yet today. But are you even awake to watch & learn, YOU TELL ME! pic.twitter.com/qOJxqDFg90

— Timothy Sykes (@timothysykes) November 19, 2025

For example:

If I buy a $4 stock and my goal is to make $1 a share, that’s 25%.

When I’m up around that number, I take profits.

Even if it only hits 80 or 90 cents, I’ll still sell.

It doesn’t have to be perfect. I just have to take the meat of the move.

If the catalyst is strong (like a hot AI or crypto news play), I might aim for 50%+ in minutes or hours.

If it’s just a morning panic dip buy, I’ll settle for 5% to 10%.

But the key is this:

Your profit plan starts before the trade. Don’t move your goals mid-trade out of greed.

Plan ahead. Size carefully. Take your profits.

If you bet too big or overstay, the market will humble you.

Don’t underestimate how powerful a consistent series of small wins can be.

Singles add up.

That’s how I’ve made millions* over time.

When I Take Partial Profits

I love selling into strength.

Locking in profits along the way feels amazing.

Everyone wants to hold for home runs. But 90% of traders lose because they refuse to take profits.

Over the years, I’ve conditioned my brain to LOVE taking small profits.

I often sell 25% or 50% of my position on the way up. That’s how I reduce risk and free up mental space.

Take my weekend trades, for example.

I often buy on Friday and sell on Monday.

But lately, many of these stocks have spiked on Friday after hours and faded by Monday.

So I’ve adapted. These days, I sell part of my position on Friday afternoon.

Adapt or die. That’s trading.

Sure, sometimes I sell early only to watch the stock go higher. That doesn’t bother me.

Other times, I sell half, the stock craters lower, and I’m SO grateful I locked in those gains.

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You can never go broke taking profits.

When I Take Partial Losses

As crucial as cutting losses is, I don’t always cut the whole position at once.

If I’m unsure about a stock, I’ll scale out instead of selling everything.

I’m fine with taking small losses to reduce my size and stress.

This is about protecting both real capital and mental capital.

If I’m down 1% to 3%, I might trim and hold a smaller piece in case the breakout happens later.

Small losses are fine. They don’t hurt your account or your mindset.

But a big loss could destroy both.

Lose the battle. Win the war.

When I Take Full Losses

We’ve all been there.

Sometimes, you have to get out completely…

If the stock breaks key support, you’re wrong. Period.

If the breakout fails at brickwall resistance, you’re wrong.

Cut it. Move on.

A 2% to 5% loss won’t kill you.

But if you hesitate, that small mistake can snowball into a disaster.

Cutting losses is your number-one job.

Even if it hurts, even if the stock later does exactly what you thought…

Who cares?

You were on the right track, but you protected your capital.

Discipline isn’t exciting. But it’s what builds accounts over time.

Avoid big losses. Avoid emotional trading. Protect your mental capital.

Because once you lose that, it’s over.

The Biggest Mistake You Can Make

The 90% of traders who lose money make one big mistake:

They prioritize reward over risk. 

They hold too long. They chase tops. They get greedy. They don’t plan their trades.

Don’t be like those guys.

• Have your profit targets before you enter.
• Sell into strength.
• Cut losses quickly.
• Stay disciplined.

You don’t need to be perfect. You just need to be consistent.

This is how I’ve traded for over 25 years. 

This is how my top students became millionaires.*

And if you follow these rules consistently, you can do the same. 

Cheers,

Tim

*Past performance does not indicate future results.