Exactly when to sell your stock for PROFIT 📈💰🚀

About this video

• Video Title: Exactly when to sell your stock for PROFIT 📈💰🚀
• Channel: Investing Simplified - Professor G
• Speakers: Professor G (Nolan Goa)
• Duration: 10:02

Overview

This video provides practical rules and psychological strategies for investors to determine the optimal time to sell a stock for profit, aiming to avoid common mistakes driven by fear and greed. Professor G outlines three key selling rules and discusses how to manage emotions through discipline and systematic approaches.

Key takeaways

• Sell when the original reason for buying is no longer valid: If the company's fundamentals, like earnings growth, change, it might be time to re-evaluate holding the stock, especially if it's unlikely to outperform the S&P 500.
• Utilize price targets and trailing stops: Setting a profit target (e.g., 30% gain) and a trailing stop-loss (e.g., 20% drop from peak) can help lock in gains while allowing winners to run.
• Rebalance when the portfolio becomes unbalanced: If a single stock's growth makes it a disproportionately large part of your portfolio, selling a portion to rebalance reduces risk.
• Combat fear and greed with discipline: Emotional investing often leads to mistakes; establish an exit plan before buying, reframe profits as future opportunities, and avoid anchoring to your personal buy price.
• Stop-losses are for specific situations: Consider using stop-losses if you don't fully understand your investment, need to preserve capital in the short term, or are retired with a large equity allocation. However, be aware that stop-losses can also lead to missing out on significant gains if the market recovers quickly.