01-24-2014, 11:28 PM
(01-24-2014, 09:53 PM)Robandcindy2 Wrote: As a follow up to this excellent thread:
Selling to lock in gains
What do you use to determine when to sell a stock losing YOU money?
I can rationalize some oil/energy stocks being down in value right now.
I can grasp my REITs being down as the investment world comes to grips with QE.
But I do have shares in some companies that are down quite a bit for no other reason than "Wall Street ain't happy with them."
Do I sell and lock in the loss forever or wait it out? In several cases I admit I own the stock because it BELONGS in a DGI portfolio but unlike Mr. Magellan Fund I only know about the company by what I can read on the net...(...buy what you know...)
Right now the only triggers I have are a cut in the dividend, a rapidly rising dividend, and an inability to afford the dividend payment.
What do you use...?
I only sell if I think I made a mistake in my original due diligence, if fundamentals have changed, or if the company cuts the dividend.
If a stock has fallen you really don't have any losses unless you sell. If you invested for the dividend income that is what you should concentrate on. Sometimes you can take advantage of Mr. Market's scorn and add to your position when its cheap. Some recent examples for me have been DE, PM, DLR and IBM.
Some of my recent sells include INTC (frozen dividend rate), MMM (overvalued) and VVC (dividend growth too low).
I don't think its wrong to cut bait if you have better options available but I don't think price alone is a reason to sell.
What stocks are you worried about?