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  • Protect yourself with stop loss orders. If a stock tanks due to poor earnings, the stop loss kicks in and sells the stock before the stock loses a significant amount of value. Look at NWL, which went from $50 July 2017 to $16 October 2018. A stop loss at the 200 day moving average would have sold the stock off at $38, preserving most of your cash as the stock went to $28, and allowed you to pick up the stock again (if you still believed in it) for $16.

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