How often to sell stocks?

[The motor guy]

How often do you guys sell a stock? I suppose you could buy one then hold onto it for 10 or 20 years, but why not buy and sell it 7 or 8 times in that period everytime it goes up? Looking at stock history charts, you could be in the same position 10 years from now as where you first started. What about if you put $4000 into a companies stock and then it goes up $150 in just a couple days then why not sell It? If you have enough stocks in different companies I think you could easily average $50-75 a day just by clicking a few buttons on the computer.

I think this beats doing nothing and constantly watch it go up and down all the time, but I think you have to wait for it to go high enough to make it worth while and cover all the taxes, broker and accountant fees to process the tax forms.

Opinions? I know this is an oil forum, but I bet a lot of the older guys on here have some stocks.

 

[vw7674]

some are buy & hold because quarterly dividend checks. & growth-sometimes.

 

[csandste]

Buy low, sell high! Think I heard that about 95 years ago.

I've never been a day trader. I don't want to time the market. I don't want to pay short term gains. I don't want to pay Schwab (even though they're dirt cheap) for trades in and out.

To tell the truth, I don't feel I know enough to be a stock picker at all. Almost everything I have is in index funds and etf's. I'm a Bogleite through and through.

If you think you have the cajones to day trade, go ahead. (day trader is probably a bit strong to describe what you're saying)

Ask that question on

https://www.bogleheads.org/forum/

I'll be interested to see what they tell you.

 

[WyrTwister]

When I need cash , I sell investments .

 

[PimTac]

Originally Posted by motor_oil_madman
How often do you guys sell a stock? I suppose you could buy one then hold onto it for 10 or 20 years, but why not buy and sell it 7 or 8 times in that period everytime it goes up? Looking at stock history charts, you could be in the same position 10 years from now as where you first started. What about if you put $4000 into a companies stock and then it goes up $150 in just a couple days then why not sell It? If you have enough stocks in different companies I think you could easily average $50-75 a day just by clicking a few buttons on the computer.

I think this beats doing nothing and constantly watch it go up and down all the time, but I think you have to wait for it to go high enough to make it worth while and cover all the taxes, broker and accountant fees to process the tax forms.

Opinions? I know this is an oil forum, but I bet a lot of the older guys on here have some stocks.




I have been investing for close to 40 years now. I have only bought a select few stocks and I stick to a rule of no more than 5% of my total assets in any one stock. My best success has been with Apple.

With that said, the vast majority of my assets are in mutual funds and ETFs. I would seriously check out the Boglehead link mentioned already. Before investing personal money I would max out on your retirement options like 401k or IRA, whatever is available to you.

 

[Astro14]

If it were so very simple, don't you think everyone would be doing it?

How would you determine when to sell? Percentage? Feeling? P/E ratio? Dividend change?

If you were to sell it before it was done going up, you will have missed out on all of the gain.

And, after you sell it, how do you know it's at a low?

How about opening up an Acorn account. Start buying and selling some stocks.

Let us know how you make out...

 

[KneeGrinder]

When I worked for a living, I day traded a lot. Week traded. Once I retired I stopped and it was shortly before the Big crash, I was in cash. I side stepped the big crash. Since then I have been in dividend stocks mostly, except Apple. Chevron, Exxon "Mobile" both pay over 4%. I have owned those for 11 years. I own many others also, but those I think you have heard of.

I have made a couple grand in a couple hours. Many times lost value and had to sit on it for weeks till I could break even. Moral of the story, Don't do it! Buy dividend stocks if you have excess money to invest.

 

[Railrust]

I think if an amature cherry picks stocks or even a pro, you're probably going to hit as much as you miss...then it becomes gambling, not investing. Big difference.

I use index funds and I only invest in my tax deferred retirement accounts right now.

Yes, I kick myself when I think about some stocks I was cherry picking when I was in my 20's, but for every Boeing I bought for $34 a share a week after 911 (it trades between $450-$380 now), there were countless others I would have lost my shirt on...EMC, Sun Micro Systems, Ford, CVS, American Eagle Outfitters, <<< all those stocks were "smart buys" at the same time I bought Boeing. I would have lost money on every single one.

 

[Wolf359]

Originally Posted by motor_oil_madman
Opinions? I know this is an oil forum, but I bet a lot of the older guys on here have some stocks.


Basically you're saying because Roulette is red 47.4% of the time, why not bet on red 47.4% of the time and cash in?

Your main problem is that you don't know when it's a high or low, only after the fact. Works great when you sell at a high and buy at a low, but you'll get destroyed quickly if you sell at a low and buy at a high. The problem is you can't predict that in advance only in hindsight.

 

[csandste]

'I use index funds and I only invest in my tax deferred retirement accounts right now. '

Biggest investment mistake I made. I invested as much as I could. Maxed out my 457 plan, maxed my wife's and my IRA (most of this was before Roth's). Put about half my money into deferred instruments. Now my taxes are almost four times higher than they were when I was working.* And my RMD will just keep rising until I die--- I do put extra distributions over my RMD into a Roth--figure it's pay me now or pay me later.

If I had to do it over again, I would just do the 457 up to the match, which in my case was 3%. Then I'd max out Roth contribution. Then rather than throwing the full amount into the 457, I would just put it into regular investments. Obviously it would take a certain amount of computing power to figure out whether or not being taxed annually was better than letting it ride deferred, but I never thought I'd be paying this much tax in retirement. The old, defer 'cause you'll be in a lower bracket when you retire is certainly not true in my case.

* I was married when working and now I'm widowed, so that makes my situation even worse. But paying 4x as much when you thought you'd be paying less is disconcerting. Those 401k's s, 403b's, and 457's will come back to haunt you if you over do them.

 

[FowVay]

I own very few individual stocks and feel that the best way to invest in stock is through mutual funds. You can buy your own individual stocks and mimic an index fund I suppose and this would save you the fees associated with buying the fund itself.

Of the individual stocks that I do own, I stick with high dividend paying companies. I do my tax loss harvesting at the end of each year and dump my underperforming duds and then reinvest my remaining cash from these proceeds in what I hope will be strong performers over the upcoming year.

Picking stock is a gamble regardless of who you are. Studying company backgrounds and learning who pushes the buttons at the corporations helps with picking winners but it takes huge amounts of time doing this. Some people enjoy it greatly and for them I am willing to pay for their expertise (the fund manager guys). This is why I have a very limited individual stock portfolio.

In response to the question of how often do I sell stock - I try to buy keepers and I like to hold onto them indefinitely. I am certainly not a day trader and I personally feel it is a foolish gamble.

 

[Mr Nice]

Total stock market ETFs with ultra low fees are your friend.
Technology ETF like QQQ has done well, so have Growth ETF index funds.

I did buy some Amazon shares a few years ago...

 

[Astro14]

I do buy and sell stocks. They meet specific objectives within a larger portfolio. It's something my wife, a former broker, and I do together.

We use a brokerage account with Schwab, which exists within my tax-deferred retirement account. The brokerage account is 30% of the total portfolio value and no stock exceeds 4% of the total portfolio.

Among the stocks we own: Boeing and Amazon. Despite recent hammering of BA, we have done well with that stock, having bought it at $44. We've lost on some stocks, like SSYS. We buy and hold. Sell when a stock fails to meet expectations. We don't have to worry about capital gains because it's all in the retirement account.

Because we work on this together, the total return is less important to me than her inclusion in long-term financial planning and decision making.

From experience, it is impossible to know what a stock is "low" or when it is "high". Very easy to look back at a stock's performance, to see those historic highs and lows, but that doesn't work when you're trying to make a buy or sell decision.

One factor the OP has failed to even consider is the capital gains impact on each profitable trade. You can only offset gains with losses up to $3,000 each year. So, it's possible to trade enough, with gains equaling losses, and still have to pay taxes on the gains. So, at the end of the year, you have the same amount of money, but have to pay capital gains tax on it even though your net is zero.

Consider, too, that stocks have been steadily going up for a decade or so now. Very easy to think that they will always go up. History suggests otherwise.

 

[Astro14]

Originally Posted by Mr Nice
Total stock market ETFs with ultra low fees are your friend.


I agree.

So would Jack Bogle.

 

[eljefino]

m_o_m, were you in the market during the 09 crash?

It's easy to say it's easy to do when it's been trucking along for a decade.

If you're looking to get in, now, get out. I don't think you have the patience for a downswing.

if you want to stay in, lock into the most generic, low fee index ETF like VIS or VOO, then don't look at the day-to-day.

 

[Astro14]

One other thought: if you really think that you could get "$50-75 a day" from $4,000 in your button clicking portfolio, you're living an absolute fantasy.

$50 return on a $4,000 investment is a 1.25% return.

Per DAY.

Compounded over a year, that's roughly a 2,200% rate of return. Reinvested, your $4,000 would be nearing $100,000 at the end of the year.

Do you really think you can do that?

"Jjust by clicking a few buttons"?

Well, do it, then.

And in a year or two, when you're a multimillionaire, tell us how.

And then, keep it up. You'll be a billionaire two years after that...asking us what oil to put in a Gulfstream 650.

All because you were able to consistently get a 1.25% daily return....

 

[Cujet]

An "especially goofy/funny" high-school friend of mine, with no formal higher education, became rich as a day trader. He jumped into real world NYC Wall Street stuff in 1981 and within short order, he was a millionaire.

I've invested conservatively over my 35 year career, and one account, my IRA, is currently valued at less than I've deposited. It took hard hits during the various crashes we've had. Never to fully recover. I would have been better off putting the IRA money under the mattress.

However, other accounts have done well and those are ahead.

I do not buy and sell.

 

[alarmguy]

Originally Posted by motor_oil_madman
How often do you guys sell a stock? I suppose you could buy one then hold onto it for 10 or 20 years, but why not buy and sell it 7 or 8 times in that period everytime it goes up? Looking at stock history charts, you could be in the same position 10 years from now as where you first started. What about if you put $4000 into a companies stock and then it goes up $150 in just a couple days then why not sell It? If you have enough stocks in different companies I think you could easily average $50-75 a day just by clicking a few buttons on the computer.

I think this beats doing nothing and constantly watch it go up and down all the time, but I think you have to wait for it to go high enough to make it worth while and cover all the taxes, broker and accountant fees to process the tax forms.

Opinions? I know this is an oil forum, but I bet a lot of the older guys on here have some stocks.


The problem is, how do you know those "7 or 8 " times???
How do you know, when the stock hits the high?
How do you know when the stock is done going down?

Answer = you dont.
For Example, if I had just bought $1000 (one thousand dollars) of Walmart stock in 1980 when I was a kid (almost)
That one thousand dollars today is worth 2,000,000 (two million) I dont know about you, but if I just bought 5000 dollars worth at the time, 10,000,000 (10 million would have been enough to retire.

You can not time the market, its not possible. Look for value, touch it, feel it, use it.
You will never know when a stock is going up and when its going down.
You state why cant your buy a stock and then goes up $150 in a few days sell it. Well, ummm ... think about this ... what heppens when the stock goes down $150 in a few days after you buy it? Do you take the loss right away or hold it hoping it will turn around? Then what happens when the stock is down $600 in a couple days ... do you ... ?

 

[ET16]

I agree that an average person shouldn't be in individual stocks. ETFs or mutual funds are better at spreading risk.

There is too much risk in individual stocks. I lost big on GE this year.

 

[alarmguy]

Originally Posted by ET16
I agree that an average person shouldn't be in individual stocks. ETFs or mutual funds are better at spreading risk.

There is too much risk in individual stocks. I lost big on GE this year.



Agree ... and ...

Index Funds are the safest of all and lowest costs.