Sell stocks now or later

[tripods68]

I want to sell 2 stocks with a combined losses of $1500 inside my ROTH account (total combined value 11.5K) Do you think this is a good idea or should I wait little bit longer. This two are the biggest losers I owned which suck!

I plan to buy XLV or VHT. What do you think I should do?

[disneysteve]

I want to sell 2 stocks with a combined losses of $1500 inside my ROTH account (total combined value 11.5K) Do you think this is a good idea or should I wait little bit longer.

The time to sell a stock is when your research shows that it no longer has the outlook that you believe it had when you bought it. If you think it is going to turn around, hang on. If you think it won't, then sell now. Waiting will just lose you more money most likely.

[Jluke]

How long have you held these two losers - are you giving up too soon?

Where is the NAV on the 52-week chart (Hi/low) - what is the "moat"?

How long till retirement and can they rebound during that time?

Interested to see the move you make - good luck!

[tripods68]

How long have you held these two losers - are you giving up too soon?

Where is the NAV on the 52-week chart (Hi/low) - what is the "moat"?

How long till retirement and can they rebound during that time?

Interested to see the move you make - good luck!

BABA bought at 93 now 81
BLV bought at 96 now at 86

I've had this stock for less than a year (BABA bought it just for a hype and BLV mainly for monthly dividends). Not looking to hold on these stocks beyond this year. But I want to buy something else that has more upside long term at least 2-3 time horizon. I'm thinking I should sell it now take the losses with interest going up later this year.

[Petunia 100]

I think that if you have to ask this question, you should not be buying individual stocks.

[tripods68]

Pertunia---If I have a crystal ball--I would've hold on my Netflix stock a little longer and made an extra 2K but settled and only made 5K. I also sold my FB stock early (sold at 74 bought at 26) pocketed $3600.

I prefer not to sell a stock at a loss but sometimes that just the way it goes right? That's part of the risk playing individual stock but I hope to play more of the upside (making $$) while minimizing losses.

I come her to get advice from smart people who plays the market 'conservatively' and hope to learn. But sometimes we get people like YOU who thinks..."well you should have known better..duh!"...Not necessary.

[Petunia 100]

Pertunia---If I have a crystal ball--I would've hold on my Netflix stock a little longer and made an extra 2K but settled and only made 5K. I also sold my FB stock early (sold at 74 bought at 26) pocketed $3600.

I prefer not to sell a stock at a loss but sometimes that just the way it goes right? That's part of the risk playing individual stock but I hope to play more of the upside (making $$) while minimizing losses.

I come her to get advice from smart people who plays the market 'conservatively' and hope to learn. But sometimes we get people like YOU who thinks..."well you should have known better..duh!"...Not necessary.

That's not what I am saying at all. Choosing individual stocks is great for those who can crunch numbers in published financial statements and analyze macroeconomic trends to identify buy and sell target prices. Most of us can't do that. (I certainly can't.) Those of us who can't are better off sticking with broadly diversified investments, IMO.

Best of luck to you.

[disneysteve]

I prefer not to sell a stock at a loss but sometimes that just the way it goes right?

Absolutely. If you could pick winners every time you'd be incredibly wealthy. Too bad it doesn't work that way.

One of the biggest problems with investing in individual stocks is exactly what you just said. People hesitate to sell losers. They don't want to admit that they were wrong. They want to hang on and wait for a rebound. They just want to ignore it and hope it'll go away. On the flip side, people also hesitate to sell winners. They overinflate their stock picking skills They figure it's gone up this far, I'll just hold on and hope it continues to climb. Of course, life doesn't work that way either. Hence the reason that most people who buy individual stocks underperform the market by a large margin.

I dabble in individual stocks from time to time and I'm not at all immune to any of this. Just a couple of months ago I unloaded a position that lost a huge percentage of my investment. Fortunately, that didn't represent a large dollar amount. I sold around $23 and last time I looked it was down to $16 so I'm glad I got out when I did. But I was thinking of selling around $31 and didn't pull the trigger.

This is why I limit my individual stock purchases to a fraction of a percent of my portfolio.

[tripods68]

This is why I limit my individual stock purchases to a fraction of a percent of my portfolio.

I completely agree! This losses represent tiny amount from total asset we own. I have been eyeing on potential "buy" in case i decide to unload my losses, hoping to make up the losses before the year is over. But for the year, i'm still at small upside. I might just hold on for another month or two.

[Like2Plan]

tripods68,
I have a tax question for you. I was wondering what happens to the loss since it is in a Roth account?

[disneysteve]

tripods68,
I have a tax question for you. I was wondering what happens to the loss since it is in a Roth account?

Nothing happens. You don't get to deduct losses within a Roth. Everything in there is tax-free already.

[tripods68]

Nothing happens. You don't get to deduct losses within a Roth. Everything in there is tax-free already.

Agreed. That's the beauty trading stocks within ROTH IRA.


Anyway, I took the losses (sold BLV & BABA) which was not easy---but they were both green this morning which made my decision a lot easier. Then bought 100 shares of Netflix @ 114 per share. Bought 100 shares VHT from the cash account (for those who think Health Care cost and Hospitalization will simply keep going up and up...Thanks OBAMA!). I'm riding this two bad boy for couple of years!!!

[corn18]

Agreed. That's the beauty trading stocks within ROTH IRA.

It's also one of the disadvantages. If it were in a taxable account, you could have taken the loss and deducted it from your income. Tax loss harvesting in a taxable account is not only a necessary evil, it is a very useful strategy. If you can't pick a winner every time, at least you can harvest the losses and get some tax savings.

I wish you luck in your stock picking and market timing. I have not been very good at it myself because I allow my emotions and intuition to get in the way of solid research. I still have some individual stock, but nowadays, I put all my investments into very low cost index accounts and the only decision I make is what asset allocation do I want to have. I am a boglehead.

Tom

[snafu]

As a buyer of individual stocks you must be prepared to accept mistakes and take a loss. I too like to 'take a flyer' and invest in a stock whose product I like or whose executive suite have had success in previous endeavours. I do my best to follow a discipline by setting a buy and sell price before taking action and sell on a 10% loss. I mostly follow my advice but every so often emotion interferes. Right now I'm sitting on an horrid loss on silver trying to decide whether to double down as the price is enticing. I don't mind riding the roller coaster of gold & silver stock, it feels familiar and represents a tiny percentage of it's portfolio. Can you see it as a trip to Las Vegas? You only gamble with the sum you can afford to lose for entertainment value.

[tripods68]

It's also one of the disadvantages. If it were in a taxable account, you could have taken the loss and deducted it from your income. Tax loss harvesting in a taxable account is not only a necessary evil, it is a very useful strategy. If you can't pick a winner every time, at least you can harvest the losses and get some tax savings.

I wish you luck in your stock picking and market timing. I have not been very good at it myself because I allow my emotions and intuition to get in the way of solid research. I still have some individual stock, but nowadays, I put all my investments into very low cost index accounts and the only decision I make is what asset allocation do I want to have. I am a boglehead.

Tom

Tomhole--When the market crash back in 2001, I took some heavy losses for couple of years selling loser stocks around 5-6K and harvested those. It was confusing and did not like it and my accountant (a friend of mine) hated dealing with. ROTH is the only way to avoid having to deal with "harvesting".