For many investors, the only decision more difficult than which investment to purchase is when to sell. Although there are no hard and fast rules, consider these general guidelines:
Compare each investment's performance to that of a similar investment or to the overall market.
Don't sell at the first sign of trouble,
Realize that emotionally it is difficult to sell an investment at a loss.
Set high and low target prices to review an investment.
Review the fundamentals
Review all your investments at least annually.
Call for another opinion.
While a specific investment's performance will vary over time depending on the market cycle, consider selling any investments that lag in performance for an extended time.
since it's not unusual for a company to go through a difficult period. But do review the fundamentals again to determine if there is a permanent change.
Many investors prefer to wait until the investment rebounds to at least a breakeven point. However, the investment may never rebound to that level or may take a long time to do so. Only hold an investment if its future prospects are good.
You don't have to sell at that point, but you should thoroughly review it.
of an investment whose price has increased significantly in a short time to decide whether it has the potential to continue increasing or if the price is just too high.
Resist the temptation to sell immediately following a market correction. Remind yourself that the market fluctuates and corrections are a normal part of that process.
Read all information acquired during the year to help assess future prospects. Look for major changes that may indicate problems or signal a change in focus. Make sure investments still meet your financial goals.
Often, discussing your thoughts with someone else causes you to consider other factors or helps ensure that you have valid reasons for selling.
