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Taking gains- what’s your approach?
Posted on 1/27/24 at 10:09 am
Posted on 1/27/24 at 10:09 am
My account has been climbing significantly in the last 6+ months, like anyone else that has money in the market. I was up 36% last year and am up 24% in the last 90 days. I have about 25 different companies in portfolio but most of the gains have been driven by the top half, mainly PANW, NOW and SYK. I am considering selling 1/3 of my shares of each one, but am really just choosing that number at random. I could park the money in the 5% savings account and wait for a drop but with the capital gains hit I’d be waiting for a pretty significant drop. I have sold stocks along the way that went through the roof after and held onto others that plummeted and saw all the gains wiped out. What is your approach? My broker basically never wants me to realize any gains and just die holding a bunch of stocks haha.
16
Posted on 1/27/24 at 10:49 am to TitleistProV1X
After this SLI debacle, setting sale triggers starting at %20 and going up
Posted on 1/27/24 at 10:50 am to TitleistProV1X
Best time to sell a good company is never.
Opportunity cost is probably biggest factor for me. Have a plan for what you will do with the gains.
Deciding when to sell is normally more difficult than when to buy.
Opportunity cost is probably biggest factor for me. Have a plan for what you will do with the gains.
Deciding when to sell is normally more difficult than when to buy.
Posted on 1/27/24 at 11:04 am to TitleistProV1X
No sense trying to time it. You’ll never get it right. But if you have an asset allocation you are trying to stick to, you should be rebalancing.
Posted on 1/27/24 at 11:17 am to TitleistProV1X
Not taking gains cost me so much money in 2021. I rode PENN, PLUG, TWLO, and others all the way up thinking they would keep going and now I'm riding them all the way down. Went from being up over 100% to down about 10%. So yeah don't be like me
Posted on 1/27/24 at 11:24 am to TitleistProV1X
I use options (sell covered calls, buy puts, etc.) as hedge or to generate additional income on the holdings. I find it helps with discipline and concern on stocks that have made huge runs.
It’s not really difficult to learn basic conservative option tactics that can accentuate and protect your returns.
It’s not really difficult to learn basic conservative option tactics that can accentuate and protect your returns.
Posted on 1/27/24 at 11:31 am to TitleistProV1X
quote:
What is your approach?
Would I put this much money into the stock today if I had cash available? To put it another way, if I was starting my portfolio from scratch, what percentage would go into this stock?
Now, if you can rebalance your portfolio with outside cash, then you may never need to sell a stock. That becomes difficult to do if as your account grows in size though.
Posted on 1/27/24 at 11:40 am to TitleistProV1X
I index invest so I don't ever worry about getting out of a certain ticker at the "right time"
I will take gains when I need/want cash to fund living expenses (i.e. in retirement).
I will take gains when I need/want cash to fund living expenses (i.e. in retirement).
Posted on 1/27/24 at 12:02 pm to TitleistProV1X
I focus on % of portfolio and try to keep that relatively consistant. That takes alot of the guesswork day to day, out of the equation. If I want to make a outsized bet on something, I do it via options in a different account. Then once a month or so, much less frequently, I might look at my %'s and alter that if needed.
As said before, knowing what to buy and when, is way easier than knowing what to sell, and when. Way more human emotion involved in selling, so you have to have a plan, or over a long enough timeline, you will lose money.
I have 2 portfolios. One of which is larger and indexed, and the other is all long individual stocks. It's nice to get a constant reminder how unlikely it is that you are going to beat the indexes, but I like paying attention and making picks as a hobby and I also find it helps me in my personal career to be attuned to what companies are doing and what's working. Lately, it seems when the market is going badly, my individual account beats my index accounts, and vice versa.
As said before, knowing what to buy and when, is way easier than knowing what to sell, and when. Way more human emotion involved in selling, so you have to have a plan, or over a long enough timeline, you will lose money.
I have 2 portfolios. One of which is larger and indexed, and the other is all long individual stocks. It's nice to get a constant reminder how unlikely it is that you are going to beat the indexes, but I like paying attention and making picks as a hobby and I also find it helps me in my personal career to be attuned to what companies are doing and what's working. Lately, it seems when the market is going badly, my individual account beats my index accounts, and vice versa.
This post was edited on 1/27/24 at 12:22 pm
Posted on 1/27/24 at 12:30 pm to Pendulum
A lot of good advice. I really like
The idea of one or two stocks not exceeding a certain percent of the portfolio.
Palo is 13% of portfolio, Stryker is 12%, Now is 8.5% and then Amazon, Microsoft and CRM is right behind those. I like all my top holdings for the long haul and that’s why it’s been hard to sell any. I could sell a little and put into a fund that encompasses those to minimize risk. I’m 37 so willing to take risk but at some point I’d actually like to realize gains
The idea of one or two stocks not exceeding a certain percent of the portfolio.
Palo is 13% of portfolio, Stryker is 12%, Now is 8.5% and then Amazon, Microsoft and CRM is right behind those. I like all my top holdings for the long haul and that’s why it’s been hard to sell any. I could sell a little and put into a fund that encompasses those to minimize risk. I’m 37 so willing to take risk but at some point I’d actually like to realize gains
Posted on 1/27/24 at 1:25 pm to TitleistProV1X
quote:
TitleistProV1X
Impossible to give any real advice without knowing your income and tax situation. Realizing gains while triggering incremental taxation in the short term “just because” is a poor strategy.
Posted on 1/27/24 at 3:50 pm to TitleistProV1X
quote:Rebalancing (less frequent as # of positions have increased).
Taking gains- what’s your approach?
STCGs - Swing trading following rapid run ups -- taking winnings off the table, then jumping back in with ensuing dips, especially in taxprotected accounts or with tax loss harvesting at play.
LTCGs - Taking long term gains is more a function of sector/stock outlook analysis or of relative valuation.
Posted on 1/27/24 at 4:28 pm to TitleistProV1X
You have some good companies there and i think at least two of those may split somewhere down the road giving you more shares. I own some good ones as well like LLY,CAT etc.. and sold some shares but looking back on it i sold some shares way to soon. You may consider holding a while longer while the market is still hot and just set a stop loss on a 1/3 of the ones you plan on selling.
Posted on 1/27/24 at 5:03 pm to TitleistProV1X
Basically just holding til I die with the plan to slowly rebalance as retirement nears, then either live off dividends, or sell off enough to live on. I don’t know if it’s a good plan, but that’s the plan.
Posted on 1/27/24 at 5:26 pm to Celery
I only sell loses of companies I no longer trust. I do dividend investing and for the next 25 years will just reinvest dividends. After 25 years I hope this account will provide me with an extra 2-3k a month in dividends without selling a stock. At least that’s my dream
Posted on 1/27/24 at 8:00 pm to TitleistProV1X
Pre-determined targets for me, for both gains and losses. Riding out losses/drawdowns are wealth killers.
Posted on 1/27/24 at 10:31 pm to TitleistProV1X
I’m struggling with the same issue now.
First world problem I know, but I rode SHOP up from $150 to over $1500 (before split) only to watch it go down to $400. Back up to $800 (equiv)fortunately, but I’m afraid my LILY & NVDA (bought at $140 & $180 so huge gains) will suffer the same fate. Sold a small amount and covered my initial basis, but trying to not miss the boat again.
I really believe in both companies having a bright future, but the ridiculously lucky growth has put me way too much in equities, primarily in these 3.
Half are in qualified accounts, and half are non-qualified, so thinking of some harvesting in non-qualified since there is no tax penalty.
Thoughts?
First world problem I know, but I rode SHOP up from $150 to over $1500 (before split) only to watch it go down to $400. Back up to $800 (equiv)fortunately, but I’m afraid my LILY & NVDA (bought at $140 & $180 so huge gains) will suffer the same fate. Sold a small amount and covered my initial basis, but trying to not miss the boat again.
I really believe in both companies having a bright future, but the ridiculously lucky growth has put me way too much in equities, primarily in these 3.
Half are in qualified accounts, and half are non-qualified, so thinking of some harvesting in non-qualified since there is no tax penalty.
Thoughts?
Posted on 1/27/24 at 10:39 pm to TitleistProV1X
Within my retirement accounts, if anything triples, I sell 1/3rd, let the 2/3rds ride and will sell 1/3rd of that when it triples again. My equities are almost totally crypto related now, although I still own some SHOP. The rest is in high yield money market accounts.
Posted on 1/30/24 at 8:58 am to KWL85
quote:
Deciding when to sell is normally more difficult than when to buy.
I struggle with this as well. Either sell too early or too late.
My wife used to joke that I sell all the stocks that are doing well so that I can buy stocks that are doing bad.
Posted on 1/30/24 at 2:11 pm to TitleistProV1X
quote:
My broker basically never wants me to realize any gains and just die holding a bunch of stocks haha.
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