Which shares to sell?

johnb123

A couple of years ago I bought a mixture of shares and funds. Whilst there have been losses and gains, overall the package has risen about 14% in that time, including dividends received. I now wish to realise some profits, and am unsure what strategy I should take when selling. For instance, do I cash in some of those shares that have risen, leaving the poor performers to, hopefully, rise in the future? Or sell the latter and give those better performing shares a chance to rise even further in the future?
Perhaps it doesn't really matter which shares are sold?
Any suggestions gratefully received!

EdGasket

There's no easy answer. You have to consider the merits of each share. The ones that have risen may still be cheap if their profits and business have grown faster than the share price. Likewise a share that has fallen could be a no-hoper and best ditched. So you can't automatically sell the ones that have risen and keep the losers. What I suggest is see how each company is doing based on their results and press releases, see what broker targets are (available on most financial websites) and consider if they look cheap or expensive as with a real market. Then sell the expensive ones and keep the cheap ones (relative to their merits of course; not literally).

redbuzzard

I suppose the question is what would you choose if you were investing now?

Your question sums up why I don't buy shares very often. Too much work for me and I admit difficult to make decisions unemotionally.

There's always the intuition that the shares that have done well are the ones to have/ add to, and the ones that have sunk should be got rid of. It's not original but it's correct to say that the result of this approach is inevitably selling cheap, and buying dear, which is how amateur investors everywhere manage to make a small fortune, having started off with a large one.

I tend to err in favour of taking profits by selling part of the successes, if they still look good prospects and reviewing the others to decide whether to take the hit or hang on.

It's certainly the wrong approach to keep selling the losers and keeping the winners. That means you end up holding the winners until they become losers...

Other than that, I can't add much

johnb123

Many thanks, edgasket and redbuzzard for your comments. Very much appreciated!