A great stock tutorial rule that many don't know about, deals with the Chief Officers of a company. Every once a while, a company looses a high-level Officer but usually it's something the investing community can predict or see it being possible. However, sometimes companies lose an executive unexpectedly stating reasons like "personal issues". This is a clear sign that something is wrong. Whether it is legal or financial problems, when the Officers leave suddenly, you need to sell your stock in the company.

Enron was a good example of this. Before the whole scandal went down, the CEO and CFO both left the company because of "personal issues". At this point, the company was soaring and both these employees where in great positions. That's why it's so unbelievable that people would leave voluntarily. Jobs like these are loaded with money, power and benefits that most work hard to achieve. These jobs are once in a lifetime opportunities because of the vicious competition that's involved. For most of these Officers, you would have to literally drag them before they would leave voluntarily.

Think about it. Why would CEO's and CFO's leave a company like Enron of their own accord? They must have done something illegal or have known something illegal was going on and wanted to get out before they were pulled into the mess. At this point, it was a clear time to sell.

Some of you might have seen your companies lose Officers unexpectedly and everything turned out fine. Some of those Officers might have even said some bogus statement like they left for "personal reasons". That doesn't mean that this rule isn't true. There are always exceptions to every rule. Its stock basics. Sometimes CEO's actually leave to spend more time with there families.

If you follow this rule, there might be a time or two where you sell a stock because a Chief leaves the company unexpectedly and end up losing because the stock continues to grow. It doesn't matter. Always play the odds and always play it safe. There is nothing more dangerous than uncertainty.

There are also going to be times where an Officer leaves your company and the stock actually rises for awhile. This might be the opposite of your opinion but to me, this is an even clearer sign that something terrible is going to happen. The stock basic rules I've learned have thought me this. To continue on with the Enron example, after the executive resigned, the stock kept growing. In fact, the stock grew another 80%. The company was still good because they kept finding ways to grow. In the stock market, growth is everything. You increase sales; you increase money and fill up the pockets of the stock holders. When they were audited and their illegal actions were exposed, the stock free-falled straight down to zero. So many investors lost tons of money and couldn't do anything to stop it.

You can never predict how a company's shares will do after an Officer departure. There is too much uncertainty involved. Some stock 101 advice on uncertainty in the stock market, no matter how much stock basic research you do, you won't be able to find the point of fall for that share. And when the bad information goes public, the shares will drop fast.

Image this. An audit in a company you own stock for reveals unethical and illegal accounting practices. Within a matter of seconds, the stock drops 20%. All these big institutions keep on selling their shares in the company and it continues to drop. Within a matter of minutes, before you can even consider selling, the stock has dropped another 20%. This can easily happen to you if you don't sell in time.

What I'm trying to say here is that no matter what happens to the company before, during and after an unexpected Officer departure, always sell. If you continue to hold a stock in hopes that it will grow just like Enron did, you're not an investor anymore. You're gambler. You just can't know when the drop will occur. It could happen in a month or it could happen the very next day. And no amount of homework you do will prepare you for the pain.

For those who still show doubt in this stock tutorial rule, think about this for a second. Is it better to lose money that you have already worked hard for to own or miss out on money that is out there to be gained?

Stock 101: Your principal investment should always be protected. There will be times where you lose some of the profits you gained but make sure you keep that principal. That's your hard earned money.

All I can tell you is that this rule will save you lots of money. Unless you're an insane investor, there is no need to risk so much on something that has so little chance of panning out. If you found this rule helpful and wish to learn tons more, please visit my website. There you'll be able to find a whole tutorial that reveals rules and tips important for any stock investor, no matter your level of experience. Click here for stock tutorial.