I find it easier to hold a losing stock than a winning one. Like if one of my positions drops 50% I have no problems holding it for years waiting, hoping for it to recover. It's like I refuse to sell it out of stubbornness, but when it comes to my winning stocks, I start getting anxious and jittery because I don't want to lose the unrealised gains I've made.
Once one of my positions goes above 100%, I really start getting twitchy, even if the company is fundamentally crushing it and doing really well financially. I hate the feeling of thinking "if it drops I'll be back to where I started, and maybe it'll even go lower than my entry" so it compels me to sell to lock in that profit.
Which is fine, if I was going to use that money to buy a car or a deposit for a house or something tangible. But all I end up doing is selling to buy some other stock. And by doing that I'm essentially saying "this new stock will perform better than the one I currently hold" but there's often no justification for that, except that the chart of the company I move my money to has a less "all time parabolic high" looking chart.
I know the old saying of "if I had money to buy the company today, would I buy it?" and if the answer is yes, then don't sell. But when I see a chart that looks like a hockey stick, it makes me really nervous that "this can't continue it's going to be shorted into the ground everyone is going to take profits soon".
There are people here who have the stones to hold a stock for 700%, 900%, 1200% or more. Like how the hell do you do it? And then there's people who even ADD more to their positions on top of the bull run. Like I saw a post of someone who was up 450% on rocket lab and had about 400 shares, then they added another 600 shares. So they even doubled their position on the top of a 450% run… Which was the right call because they're up like 1000% now.
How do you continue holding a stock that's gone up a lot?
byu/AltruisticOwl156 instocks
Posted by AltruisticOwl156
26 Comments
Conviction
I don’t. I sell 5% into a 50% run.
I’ve found taking profit helps. I’ll start taking profits at 30-40% and let the rest cook for a while.. maybe take some more profits maybe not. Knowing you pulled some money out in profit helps when it goes down a bit because you’re like oh i did the right thing but your horse is also still running.
why does this matter? the billionaires who run the companies you own stock in wont reward you for loyalty. just sell when you want to and buy a different stock. this is one of the silliest mentalities that permeates these subs
Just think Apple if ever in doubt. Imagine having sold it over the last 20 years every time it gone up 100%
I have held Costco for a very long time, when I think is overvalued I sell about 10%.
Sell losers at the end of the year. Looking at the portfolio and seeing all green for years is a greater feeling.
By realizing I still have over 10 years till retirement and wanting it to go up a lot more
1300% currently on a ticker.
I limit the amount of sales (larger sales more than $1k an order) to like 6 -7 times a year. minor unlimited, but usually can’t be at loss.
my 1st at loss this year was tdg yesterday. at 21% loss.. plus some ticker offloading. less than $100 trades.
last year it was qcom at 20% loss, msft 1% marginal gain.
Trim some of it and set a stop on the rest. Much easier to ride the ups and downs that way.
I have holdings up 60,000%. Don’t overthink it. If you still have confidence in a company, even after big gains, try to relax and continue to hold it.
“Has my thesis change?”
It’s my worse problem. I can’t defeat it. Yet
Depending on the position size I might trim once it becomes long-term, but only if I feel they’re losing momentum. Otherwise I start a new position in another stock and try to get another winner. I usually like to invest in multiple sectors, so the biggest winner doesn’t dominate the port. I’m just picky about concentration.
Other than that having a thesis for why I bought helps me hold.
Hold compounders, sell a bit of cyclicals when they had a run up
Never sell your winners. I know you get nervous and I’m not gonna lie I get nervous too but it’s the biggest mistake
You just hold it. You don’t have to do anything.
you make the decision at the beginning of the investment, not constantly re-analyzing what to do with it.
– is this a medium term play, where i’ll take profits after 1 year of holding, where i net at least 25%? (make up your own %)
– is this a long term play, where i think the company will continue to thrive in 5-10 years, and i dont need this money and its going towards retirement
– is this short term play where i’m aiming to net 30% within 4-8 months because i see a trend building and will make a bet
I just pull the initial investment and let the “Free Shares” ride
By selling some of it
I’d rather pay short term capital gains taxes on it than lose my profits. I do it every year.
You sell wathever uou want, ut you never touch the initial investment after that day’!
(If you bought for 30k amd it went to 300k, sell for 270k and leave forever that 30k)
You answered your own questions. It’s really hard. Fight to remove emotion from the equation.
I own TSM, Amazon at $80. You would sell that? To buy what?
It’s a double-edged sword. It’s one of the things I’m probably the worst at. The reason why is so many stocks run up a bit and fall right back down. So when I look at statistics, the smart thing to do on a big pop where you’re easily outperforming the S&p 500 is sell it
However it changes when you look at your overall return if you actually do pick a runner. First, most of the runners have all been in tech. At least recently. I have a friend that has done this with klac. He’s up to 1100 shares now. Still hasn’t sold. That’s 2 million and he still has a mortgage
You have to believe in something and that’s the hard part because there are countless examples of people who have believed in some type of financial product only to ride it down to the ground. I trade the best when I have no feelings, no emotions
I think if someone is going to do it, you take small but concentrated bets in things that are well researched that have the potential to go and you go into the trade telling yourself you’re going to give it a minimum of a year or two or whatever time frame. Like I did that with Medline when they had the ipo. I get the business, I see the growth potential, I’m just ignoring it for a few years.
Because if you sell it then chances are you’re going to be paying a large tax bill next year