How do you know when to book profit on an investment?

DK Aggarwal

Booking profit on your investment is as important as making the investment itself. When you invest in stocks, it is critical to be aware of all the factors that can impact market movement and those that can impact the stocks you hold.

There are four main situations where investors must not delay booking profit. These are as follows:


It is important that an investor remains informed and carries out a comprehensive research in order to be able to book profit at the right time. An investor can get the best returns on an investment by booking profit in a well-planned and timely manner.

Also, while booking profit, one should ideally encash only a small portion of investment, as it can deliver twin benefits. Firstly, an investor can secure the profit on a certain part, and secondly, the rest of the investment will continue to grow. All in all, the most important thing in all this is the timing.

(DK Aggarwal is the CMD of SMC Investment and Advisors)