Selling stock look something easy to do, but trust me it is not easy as it look. Human psychology make it become harder to do, if you sell to fast you will make a less profit, if you late to sell,it can be down and make you lose your profit. For me buying stock is easier rather than selling stock, you need a valid reason when you want to sell it.
There are several strategy about when the right time to sell your stock, you can choose which one is match with your investing strategy:
- Sell it when your stock price is higher than it’s intrinsic value, This strategy is being popular by Benjamin Graham, his strategy is buy the stock when it’s price lower than his intrinsic value and sell it when it’s price higher than it’s intrinsic value. Benjamin Graham believe that risk from stock is come when market in bullish, and lower risk when market in bearish.
- Sell it when there is something wrong with your stock company fundamental, there are not a company who will always great, even a great company will be lead by someone dumb one day, so make it simple, if the company are waste investor money or company vision is not same as yours, just sell it.
- Sell it when you are realize that you make a mistake, there are no need to shame, everyone can make a mistake, even the greatest investor, Oracle of Omaha Warren Buffet admit that he also make a mistake in his investment, so just be truth with yourself, it is better that you realize early and sell it quickly before your mistake is too deep.
Never fell in love with your stock, you need to sell your stock when its already match with your investment strategy, don’t overconfident with your stock, sometimes stock can be extremely high because of other people greedy, and that is the perfect time to sell it, don’t let your greed make you blind. You have to always remember what Warren Buffet say ” Be greedy when other fearful, and be fear when other greedy”.
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