Selling shares standing at a gain

Linton

I hold about 20 individual shares for income. Shares are completely sold when they cease to provide 3.5% income and the holding is cut back and the money redistributed when/if the share value reaches about 10% of the total portfolio. The numbers arent precise as the portfolio will only be reviewed once or twice a year.

martinsurrey

On any self picked shares I hold, when I review my positions I ask my self THE question

"If I had the cash in the bank today, would I buy the shares I hold?"

If the answer is no, I sell them, if its yes I hold them, what I bought them for is mostly irrelevant (tax being the only wrinkle).

Its all about current and potential value

steampowered

Uncle_Bob wrote: »

* If a share doubles in value do you sell half of your holding to 'bank' your original cost?

I tend to follow something like this and it works well for me.

I try to buy shares which represent good value for money.

If that share increases in value by more than 10% - then unless there has been significant change in the investment fundamentals - that share is starting to look overpriced and I sell it.

If that share decreases in value by more than 10% - then unless there has been significant change in the investment fundamentals - that share is starting to look cheap and so I buy more.

steampowered

This is the trap that a lot of novice investors fall into. Don't buy or sell investments based only on what happened to the price in the recent past.