Successful investing requires disciplined risk management rather than relying solely on stock selection; investors should follow a systematic approach where losses of -5% to -10% trigger no panic selling, -10% to -15% allow one cautious additional purchase, -15% to -20% require re-evaluating the original investment thesis, and gains of +10% to +50% should be managed through partial profit-taking and trend confirmation rather than premature selling or excessive greed.
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