Anyone selling to capture gains?

[besa]

I bought like it was a fire sale after the covid crash. I have a stock that is up over 50%. I have several that are up 30%. I am risking < 5% of our portfolio.

Since I am still working, I have some flex.

I decided to try to capture the growth vs let it return to 0 if there is another crash.

My plan is to sell if there is a 5% drop. Stop limit sells.

Anyone trying this strategy besides me?

Thoughts?

 

[RobbieB]

No gains in stocks or bonds, just losses.

 

[Animorph]

I'm no trader, but I have bought individual stocks during recessions. You're just guaranteeing a 5% loss from now with a stop loss. If you know you want to sell above a 5% loss from Friday's prices, sell now. You'll make more than waiting for your stocks to drop 5% and then selling. I'm pretty sure with the volatile market a 5% loss will probably occur this week! Knowing the general market is pretty much still 20% down I might wait longer for the rest of the recovery.

If your stocks have already recovered, then you've made the quick gains and I'd sell and move on. If you have stocks in mind that are still depressed and haven't recovered, they might be better now than your current stocks that have significantly recovered. If you had a specific goal in mind and it has been met, sell now and find another opportunity.

 

[besa]

I'm no trader, but I have bought individual stocks during recessions. You're just guaranteeing a 5% loss from now with a stop loss. If you know you want to sell above a 5% loss from Friday's prices, sell now. You'll make more than waiting for your stocks to drop 5% and then selling. I'm pretty sure with the volatile market a 5% loss will probably occur this week! Knowing the general market is pretty much still 20% down I might wait longer for the rest of the recovery.

If your stocks have already recovered, then you've made the quick gains and I'd sell and move on. If you have stocks in mind that are still depressed and haven't recovered, they might be better now than your current stocks that have significantly recovered. If you had a specific goal in mind and it has been met, sell now and find another opportunity.

Thanks for the consideration.

 

[harley]

If I had bought stocks (especially if they are in an IRA) and they were up 50%, and they weren't necessarily something I was going to hold forever, I'd sell. I bought some, but most are still down and the ones that are up are just up a bit. I do have some sell orders in, but they haven't made it to that 25% level yet.

On the other hand, if they were in an after tax account and short term gains I probably wouldn't sell. And if they were stocks that I thought I'd like to keep forever I might sell if I thought they'd go back down, but that would be taking a chance. Good luck, whichever way you go.

 

[DrRoy]

I do zero trading. Keep in mind that the market can open 10% down, or go down 5%, trigger your sell, and shoot back up. You got lucky this time.

 

[Montecfo]

If these are trading positions, what is your objective? I would be looking for 20-25% gains. Then I would sell half or all.

Continuing to hold trading positions after huge gains in this volatile market is asking to ride them lower, in my view.

 

[Rianne]

Not selling anything. We have a 5 year horizon for VG portfolio. The only possibility is backdoor Roth conversions before the tax rate goes up, which is highly likely.

 

[besa]

Seeing folks here shy away from acting/talking about selling/buying during up/down times is a lesson.

 

[Jeffman52]

I'm no trader, but I have bought individual stocks during recessions. You're just guaranteeing a 5% loss from now with a stop loss. If you know you want to sell above a 5% loss from Friday's prices, sell now. You'll make more than waiting for your stocks to drop 5% and then selling. I'm pretty sure with the volatile market a 5% loss will probably occur this week! Knowing the general market is pretty much still 20% down I might wait longer for the rest of the recovery.

If your stocks have already recovered, then you've made the quick gains and I'd sell and move on. If you have stocks in mind that are still depressed and haven't recovered, they might be better now than your current stocks that have significantly recovered. If you had a specific goal in mind and it has been met, sell now and find another opportunity.

I agree. I have made that same mistake. I think I am being safe by setting stop losses but sometimes they go down so fast you lose more than you think before you get a sell. If I am unsure enough to set a stop loss, I would sell or at least sellsome.

Right now I am in a OTC stock that I am up over 200% in the last month. Today I sold to at least get my original investment out. Now I feel like I'm playing with House money. So I can still sell if it looks like I need to or I can hold and hope for the Golden egg. But since its 'house money" I can afford to take a few chances.

 

[HI Bill]

Since most of my investments are older, I'm still not in the position of selling to create capital losses to offset LTCGs from a large sale I made in January. The glass is half full and half empty at the same time!

 

[besa]

I agree. I have made that same mistake. I think I am being safe by setting stop losses but sometimes they go down so fast you lose more than you think before you get a sell. If I am unsure enough to set a stop loss, I would sell or at least sellsome.

Right now I am in a OTC stock that I am up over 200% in the last month. Today I sold to at least get my original investment out. Now I feel like I'm playing with House money. So I can still sell if it looks like I need to or I can hold and hope for the Golden egg. But since its 'house money" I can afford to take a few chances.

On the stocks I sold, I plan to get back in below what I initially paid or close to that. I have limit purchases in place that hold until August.

That way, I am holding the purse strings. I might move the money into a 1.5% saving act while I keep an eye on things.

 

[Live And Learn]

I did sell, and then immediately repurchase to reset the basis of several positions I had which had gains. I know my tax rate is at its lowest right now (before RMDS). I would have done this regardless of the current volitility

 

[Elbata]

I'm generally a believer in long term buy and holding (LTBAH), bond/stock balancing. But before the market went down, I sold 25% of my portfolio. Then shortly after another 50%.

Being naive about the market, I made a few moves, and saw one of my stocks rise by 80%. But being a LTBAH guy, what I've bought, I'm just letting it ride. A lot of this is in my Roth. So the beauty is I can I buy and sell and there are no short or long term cap gains. It's just hard for me to wrap my head around these times are different than usual.

 

[besa]

Folks are waiting for the rebound which will be like a rocket ship when it comes for sure.

My issue is that I wasn't in the market really at all. But now I am.

I am only in/ready to get in with about %10 of our nest egg. My wife is leaving it all up to me. When I talk money, she checks FB.

I got in near the bottom of this COVID crash. So it will work out, I am covid positive (sick joke... double pun intended). I still have a fair amount of cash ready to go.

That is what Buffet is doing right?

Any specific advice regarding my decisions? Telling me I just got lucky could be considered advice i guess.

The main thing I read here is folks not doing anything big right now. That makes sense.

I pretty much bought dividend stocks at their 52 week low.

I also got a few shares of BRK-B at ~60% off its all time high. I feel good about that.

I am hoping for a BRK-B split soon based on the split in 2010 and the growth since. Those things can happen without notice

Since I want to be like Buffet, I figured I should own some of his stock.

I am planning to DCA/buy more upward trending aristocrats at any decent crash with what is left of my planned 10% entry into the market. I am optimistic for now.

After that it is going to be following Buffet's strategy of:

"Don't just do something, stand there."

Thanks.

 

[targatom2019]

sell then what, pay capital gain taxes ? I only sell if I need money.

 

[audreyh1]

I agree. I have made that same mistake. I think I am being safe by setting stop losses but sometimes they go down so fast you lose more than you think before you get a sell. If I am unsure enough to set a stop loss, I would sell or at least sellsome.

I wasn't ever that comfortable with a stop loss order, and after seeing flash crashes in the late 2000s and early 2010s confirmed my discomfort.

There were several incidents when stocks suddenly dropped and then recovered shortly thereafter. Automatic stop loss selling meant some sales occurred at a much lower price than expected, but the stocks recovered so the investor was out of luck.

 

[LOL!]

Yes, I have captured gains, but basically, I am rebalancing out of equities after I rebalanced into equities back in March. I'm trying to keep my allocation to equities and bonds around where I have always had them. The volatility down AND up has been interesting. And that goes for both bond funds and equity funds.

No taxes involved since I rebalance in tax-advantaged accounts like a 401(k) or 403(b).

 

[njhowie]

sell then what, pay capital gain taxes ? I only sell if I need money.

When folks are looking at losses, I always see many saying "It's not a loss until you sell". Well, by the same token "It's not a gain until you sell".

OP bought specifically to take advantage of the short-term price dislocation. He made a good move and was sitting on a nice profit...if he sells. He's held the stock(s) for maybe a month, so his APR is ridiculously high for his 50% gainer. Why be concerned about paying taxes on the capital gain? Paying the tax is a testament that you made money, it's guaranteed money in hand by selling. Holding, anything can happen over the next month, six months, year.

The days the market panicked last month, I bought a swath of decent quality exchange traded debt of a company I am extremely familiar with. At the low, the yield was in excess of 20% on one of the issues. Since then, the shares have almost tripled. Should I have continued holding, risking that gain? Heck no - I pocketed over 10 years of interest in a few weeks. I'll pay the tax on that type of profit every day of the week.

 

[besa]

I have been using td Ameritrade for a while.

There is a way to set a window of trading price.

That way I don't sell too low or buy too high.

Setting a single price could result in a miss either way.

For example: I could set a stop limit buy for apple starting at market and ending $3 above market.

The system puts the orders in at market and buys my amount higher/lower until my limit is reached.

There are ways to really screw up here, so I quadruple check and do most of my limit purchases after hours.

 

[targatom2019]

When folks are looking at losses, I always see many saying "It's not a loss until you sell". Well, by the same token "It's not a gain until you sell".

OP bought specifically to take advantage of the short-term price dislocation. He made a good move and was sitting on a nice profit...if he sells. He's held the stock(s) for maybe a month, so his APR is ridiculously high for his 50% gainer. Why be concerned about paying taxes on the capital gain? Paying the tax is a testament that you made money, it's guaranteed money in hand by selling. Holding, anything can happen over the next month, six months, year.

The days the market panicked last month, I bought a swath of decent quality exchange traded debt of a company I am extremely familiar with. At the low, the yield was in excess of 20% on one of the issues. Since then, the shares have almost tripled. Should I have continued holding, risking that gain? Heck no - I pocketed over 10 years of interest in a few weeks. I'll pay the tax on that type of profit every day of the week.

I would have to pay close to 300K in capital gain taxes and that's why I only sell if I need money to spend. You are a day trader so it's perfectly ok but I am a long term investor and the same for 99% of people on this forum.

 

[njhowie]

I would have to pay close to 300K in capital gain taxes and that's why I only sell if I need money to spend. You are a day trader so it's perfectly ok but I am a long term investor and so 99% of people on this forum.

As those who know me know, my AA is 2%/98%. What 99% of the people on this forum do or think is of little concern to me. The past month has shown me that doing what 99% of the people on this forum do is not always the best approach.

 

[targatom2019]

As those who know me know, my AA is 2%/98%. What 99% of the people on this forum do or think is of little concern to me. The past month has shown me that doing what 99% of the people on this forum do is not always the best approach.

I don't see a problem with using 2% of your portfolio to have some fun day trading. How about using majority of you portfolio to day trade and let us know ?

 

[Aerides]

Seeing folks here shy away from acting/talking about selling/buying during up/down times is a lesson.

From what it sounds like:

- you bought these pretty low somewhere during the slump
- they've made significant gains since that time
- you spent basically play money
- you want to keep riding them in case they go up, but would sell at the first sign they might be going down

Sure, no issues other than STCG taxes of course.

 

[njhowie]

How about using majority of you portfolio to day trade and let us know ?

And why would I do that? Are you sure you even understand what day trading is in contrast to what I and OP have described?