When to sell?

The #1 hardest question I get every day!

The two biggest reasons I start thing about selling are

1) I need Capital for
a. Another investment
b. Risk Management

2) I start worrying about a stock's price movement

So here is a breakdown of 7 Reasons to Sell

1/

Reason to sell #1

When I start watching price excessively

It is usually time to trim or sell the position

It doesn't matter if I am up or down

If it's causing stress, I haven't sized the position correctly, or intuition is telling me it's time to get out

2/

Reason to sell #2

When I start a position, I give it my own price target (PT)

Once the target is hit, I either

a. Sell
b. Change price target
c. Trim & change price target

Many factors affect this decision, but if I start watching every % change ...

See reason #1

3/

Reason to sell #3

When the price does the unexpected

If a stock is dumping, and the cause is unkwn or against thesis, it's time to sell

If the price runs 200% in 2 weeks ($PLTR), maybe it's time to take some profit also

4/

Reason to sell #4

When a stock underperforms it's peers

Another way of saying, dont fall in love with a position

If a position is moving sideways, or down, while others in sector are soaring, it's time to sell

Used mostly on spec positions, not LT holdings

5/

Reason to sell #5

When a better opportunity is found

When I find a new investment; either for growth, income, or diversity

And need Capital

I review all holdings for the criteria in 1-4 above

If that doesnt produce results, I move to #6

6/

Reason to sell #6

Position size

A position that has ran 200% can quickly become outsized from original capital allocation plan

It is usually best to let winners run

But occasionally the grow too big

If I trim here, the op needs to out weigh the existing inv

or reason #7

7/

Reason to sell #7

Raising Capital

Whether for other investments, taxes, bills, or risk management

I review all the above reasons for obvious places to trim/sell

If none found, I start cutting the lowest conviction positions until fund requirements are met

8/

Selling is the hardest part of investing for many people (including me)

I err on the side of selling new positions early, and holding conviction positions long

Mistakes happen, and my biggest indicator is still my guy

9/

If it doesn't feel right

or too good to be true

No harm in getting out and living for another day

Hope this thread helps you in your own trades.

You can read an expanded version here

/End https://share.commonstock.com/vMK7MYuXqcb