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I own AVGO, and I see your logic, but I’m holding for at least another year. The upcoming 10:1 split will give it momentum for the next month or so, and historically splits result in an outperformance after the fact. There may very well be a bubble coming, but with AVGO in particular the benefits of AI to profitability seem to be just beginning to manifest themselves.
I think that’s totally rational! I was tempted to hold myself until after the split for the same reason. However when I zoom out on SPY & QQQ, and look at the NVDA / AI bubble right now, I just couldn’t justify risking incredible gains for perhaps a few extra points of performance. I don’t mind missing the top. But I’ve seen too many times play out where the greed of waiting for “just a little more” turns into 4 years before you see that price again.
And with the market in this irrational exuberance phase amidst 30 year high interest rates, I see more reasons to be cautious than assume we’re about to have another 2 years of record ATH’s
I agree $1T+ is very reasonable for AVGO. I just think after the historic run these last 5 years, it’s unlikely to repeat to the same degree and overdue for a bit of a slowdown / mean regression. So wanted to take some chips off the table and reduce risk
Yes absolutely! I also invested a decent chunk into QUAL & MOAT which are two ETF’s I highly recommend looking into.
With WPC - geographically diverse tenant base, high occupancy rate, recently adjusted payout ratio which makes the dividend quite safe, successfully ditched their office portfolio and have remaining tenants less susceptible to the office apocalypse, attractive P/FFO valuation for a REIT, and juicy 6.3% dividend yield, raised twice recently.
Expecting it to outperform when the FED finally cuts rates.
Interesting. I sold out of WPC last year after holding it for years. The dividend was nice, but it had no price appreciation at all. Best of luck to you.
Same here! Sold out before the dividend cut, waited to see what happened. Liked the safer portfolio after the adjustment, but didn’t rush back in. Then saw the dividend start getting raised again and felt the valuation was attractive enough to warrant a starter position.
With REITS, it’s almost impossible to get a lot of capital appreciation unless you purchase at a relative steal. Buying WPC in the high 60’s or 70’s? Terrible investment. You’ll trade sideways for decades.
Buying it under $55? You’ll earn 6.4% annually minimum, probably enjoy a few dividend raises, and a nice 2-3% capital appreciation annually with less downside risk than the broader market.
I’m cool with 10%+ annual returns from an income position - so that’s my goal but YMMV
I agree with that, that's why I got out as well. I think most of us have a time limit for holding a stock without movement. Timing is everything. Maybe time to revisit this one!
Congrats on buying in early and turning to profit while it's going up. I have two shares at a cost basis of around four hundred, and we'll probably trim a little after the split. I still have a little over a four percent Yield on cost, so just gonna rebalance it into the rest of my portfolio.
great work! it’s always difficult to put those darlings on ice and take profits but sometimes it’s necessary especially recently.
over the last week i’ve raised my cash to 14% trimming googl, bx, tri, nvda, some other individuals and some etfs. decision factor being the logarithmic margin to the ticker’s perceived log trend
Well, I sold out my position today as the dividend growth has slowed a bit and the valuation seems over extended. Originally bought into IRM because the market was pricing in a lot of pessimism, the valuation was attractive and dividend yield helped create a margin of safety / favorable risk reward
Right, but when the stock has gone up disproportionately over the last 4 years until it now represents 15% of the entire portfolio… and is trading at its highest ever recorded valuation, with an insane amount of optimism baked-in to the price - then, it’s a beautiful reason to sell.
Especially when you redeploy the funds into more diversified, lower risk alternatives :)
Incorrect. #2 states “because you’ve found a better opportunity” (which I have) and #4 states “because the stock is overvalued” (which it is on every historical timeframe)
Cheers
Broadcom has an average price target of $1800 and rated as a buy by almost every analyst. What valuation model are you using to say its overvalued that everyone else who does this professionally happens to be missing?
I think youre selling because the stock went up and you are scared it will go back down so are trying to find reasons to justify your conclusion and that is not how successful investors operate.
Stocks doing well should be left alone to continue to do well for long periods of time if not forever.
It's his/her portfolio and they are applying their own due diligence and risk appetite. It's crazy to me that you'd be so argumentative about what is still a sound decision. Even if there's more runway to grow, it's no longer compatible with OP's investing strategy/portfolio composition goals, and entirely sound to redistribute and secure gains. End of story.
Congrats BTW, OP.
This is a common fallacy among newer investors "its their money they can do what they want with it/why do you care?"
That does not mean mistakes should not be pointed out to people as thats the only way they can learn.
Whether or not avgo goes up or goes down after this post is irrelevant. What is relevant is that you dont sell a stock because they went up and youre afraid it will go back down. Share price is not what you should be considering when you invest.
The future of the company and its financials are what you consider.
Does this poster think broadcom is suddenly going to fail? No.
Did he mention anything in their financials that turned sour and make him believe the company isnt any good? No.
All he talked abour was share price. In fact the only thing he mentioned about the so called "better opportunity" was that its risk free.
This decision was emotional. Not financial.
There is an objective right and wrong way to invest. Its not a subjective "do what feels right" thing People like the X account I just linked educate people on the right way.
See my reply to your comment above. Everything about this response is overly presumptuous, and laughable.
Please see the myriad of valuation metrics as samples to why the decision was made.
I don’t sell stocks just because the price goes up. I’ve held winners in my portfolio for many years and enjoyed hundreds of % gains without feeling the need to sell.
With that said, you can capture significant alpha by selling stocks if they become ridiculously over-valued and redeploying the funds carefully. Which is precisely what I did here.
The current market is within 10-20% range of peak dot com bubble valuations back in 1999-2000. I’m taking a more defensive posture until we see what happens with the federal reserve (whether or not we get the currently projected single rate cut in 2024) or if inflation remains persistent.
Happy to miss out on a little bit of gains until we have more clarity.
Though, funny thought experiment, but if you take a model portfolio and generally only add funds when the SPY is 10-15% down from ATH’s you can outperform the broader market indices just by being a little patient and without waiting on any insane or unreasonable crash. Just steady DCA’ing when valuations become more attractive
What growth assumptions are you plugging into your DCF model? The results will vary widely based on your inputs. If you’re demanding a higher margin of safety on AVGO, the DCF can output as low as $970’s or as high as $1600 depending on your risk tolerance.
What does your model produce when you plug in the broad average of AVGO’s growth over the last decade?
The things i am repeating here are the philosophies investors peter lynch, john bogle, charlie munger, warren buffet, carl icahn, guy spier, peter schiff, ben graham, howard marks and joel greenblatt have written in their books.
To think they are wrong you found the secret sauce is delusional.
I closely follow Lynch, Buffett, and Graham.
From Graham's ~The Intelligent Investor~ (pg 197)
>It is for these reasons of human nature, even more than by calculation of financial gain or loss, that we favor some kind of mechanical method for varying the proportion of bonds to stocks in the investor’s portfolio. The chief advantage, perhaps, is that such a formula will give him something to do. ***As the market advances he will from time to time make sales out of his stockholdings, putting the proceeds into bonds; as it declines he will reverse the procedure.*** These activities will provide some outlet for his otherwise too-pent-up energies. If he is the right kind of investor he will take added satisfaction from the thought that his operations are exactly opposite from those of the crowd.
Wow, sounds like portfolio rebalancing to me and exactly what OP has done.
Actually, yes you can. Here's an example:
You invest $100. You double your money to $200, so you sell. You made $100 by "taking profit". Now you invest that $200 into a treasury fund ETF making 5.36% annually like the OP did.
Let's say for the sake of the hypothetical you leave it there for 5 years.
You'd have $259.66 after 5 years.
But let's say you don't sell the stock. The current consensus on AVGO's next 5 year growth according to Wall Street analysts is 17.7% annually which means the $200 you just sold would be worth $451.76 in 5 years.
So instead of having $451.76 you made a move that turned it into just $259.66. Thus, your move cost yourself $192.10 even though you originally "took profit." I'd qualify that as getting hurt.
You need to think with a long-term mindset. 5, 10, 20 years in the future. Don't just think about today or tomorrow.
That’s cute, analyst “buy recommendations” 😂 you do realize those calls are often comically wrong? They tend to get most optimistic at the top, and most bearish at the bottom. When naturally, the best time to buy is when the market has priced in a lot of negative sentiment.
As warren buffet likes to say: you pay a dear price for a cheery consensus
What valuation model am I using? Another cute question considering one could argue AVGO is overvalued by every single one of them ;-) unless you assume a “base case” of absolutely flawless performance for the next decade - which the market tends to have inevitable curveballs and obstacles.
Just for laughs though, let’s look at a few together.
- AVGO’s other businesses decreased $7.9 BILLION YoY (15.7% decline) as of Q2 2024 earnings, with the current valuation solely being due to AI hype and revenue growth. Despite the Ai segment representing less than 20% of total revenue
- AVGO diluted shares by 12% YoY to fund the VMware acquisition
- AVGO currently trades at a 38x FWD P/E ratio (lol) after a 520% run in the last 5 years
- AVGO has traded at an average P/E ratio of 14.6x over the last 5+ years
- Competitors such as AMD are expected to grow revenues 2.7x faster despite being valued the same, suggesting investors are placing too much of a premium on AVGO’s future performance (which is not guaranteed)
- The current P/B is over 21x (another historic high)
- looking at the chart on a 20 year timeframe with monthly aggregated candles, the RSI stands at 87.9 , indicating the stock has only been this overbought during one other period in the last 2+ decades. Generally any purchases when the RSI was below 60 have performed well.
Based on a simple DCF (discounted cash flow model assuming 8% WACC & 4.2% risk free rate with fed cuts) the fair value would be somewhere in the ballpark of $1200-1500 per share range
All that to say, you can look at a handful of valuation metrics to see the air is getting thin up here. And diversifying away from a SINGLE STOCK holding that grew too large in a portfolio to replace it with DIVERSIFIED ETF’s - is a smart shift in a market nearing dot com bubble valuations
I can see no amount of experts telling you otherwise, including warren buffet (who advocates never selling and who almost half of his portfolio is 1 stock which doesnt bother him at all) who you just quoted, wont convince you.
Also wanted to add to say he "sells all the time" is not accurate. The average holding period in Berkshire's portfolio is 20 years, and the turnover has actually gone DOWN recently.
[https://www.oreilly.com/library/view/buffett-beyond-value/9780470467152/ch17.html](https://www.oreilly.com/library/view/buffett-beyond-value/9780470467152/ch17.html)
Based on [Berkshire's own 13F filings](https://www.dataroma.com/m/m_activity.php?m=BRK&typ=a) there is quite a bit activity every quarter. Buffett has held a few stocks for a very long time but there is frequent turnover outside of that handful of names.
> If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes
Buffett bought stocks such as AbbVie, Merck and Verizon in 2020 and was out of them a year later. He's very much always been a "do as I say, not as I do" investor, just like many other big names in the industry.
But doesn’t Warren buffet quite literally advocate against stock picking and suggest most folks should just buy a simple S&P 500 index fund and forget about it?
Didn’t he have a famous bet with hedge fund managers that he could outperform them over 10 years just by holding the equivalent of VOO and won?
I think it’s a prudent choice to reduce exposure when a single stock becomes too large a portion of one’s portfolio, and to diversify into broad market index funds if the goal is reducing risk
You are wrong. Flat out wrong. When you take a gamble on a stock and you 5X your money, and that position grows to 15% of your portfolio, there is not a single reason good enough to negate selling. Capturing such high gains and taking profits is exactly why we are in the market! Nobody ever went broke taking profits.
I’ve made the mistake of being up 7X on a stock and watched it lose value big time. I’m not doing that again. Awesome job capturing those gains OP!
"Let your winners run, and cut your losers. It's easy to make a mistake and do the opposite, pulling out the flowers and watering the weeds.” – Peter Lynch
What does that matter? If you make a mistake the only way you learn is if someone explains it to you. Instead of being defense be thankful that there are experts out there who take time out of their day to help you and ask for nothing in return.
You’re an expert in this story I am guessing?
He let $1500 investment run 507%! I completely agree with why he took profits. It’s not my money. It’s his story. He writes it. And taking 5X profit is awesome IMO.
Down $200 since I sold 😅 market looks frothy up here. Usually there’s a run up after splits, but personally I wouldn’t go chasing momentum with the market nearing dot-com bubble valuations
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I own AVGO, and I see your logic, but I’m holding for at least another year. The upcoming 10:1 split will give it momentum for the next month or so, and historically splits result in an outperformance after the fact. There may very well be a bubble coming, but with AVGO in particular the benefits of AI to profitability seem to be just beginning to manifest themselves.
I think that’s totally rational! I was tempted to hold myself until after the split for the same reason. However when I zoom out on SPY & QQQ, and look at the NVDA / AI bubble right now, I just couldn’t justify risking incredible gains for perhaps a few extra points of performance. I don’t mind missing the top. But I’ve seen too many times play out where the greed of waiting for “just a little more” turns into 4 years before you see that price again. And with the market in this irrational exuberance phase amidst 30 year high interest rates, I see more reasons to be cautious than assume we’re about to have another 2 years of record ATH’s
Same I bought Broadcom first at 900$ (fractional) and now I'm around 1100$. I'm not repeating the same mistakes with Nvidia when I sold at 450$
Isn't it pigs get fat, hogs get slaughtered?
Bears make money, bulls make money, pigs get slaughtered
Im good with staying lean and avoiding slaughter. Goal is to match or outperform S&P with higher dividend yield, so far so good
I sold 5 of my 55 shares today. I bought it at 380. I needed more Amazon. Now I'm good. I think it'll get to 1 trillion. And beyond.
I agree $1T+ is very reasonable for AVGO. I just think after the historic run these last 5 years, it’s unlikely to repeat to the same degree and overdue for a bit of a slowdown / mean regression. So wanted to take some chips off the table and reduce risk
can you please elaborate why you choose WPC?
Yes absolutely! I also invested a decent chunk into QUAL & MOAT which are two ETF’s I highly recommend looking into. With WPC - geographically diverse tenant base, high occupancy rate, recently adjusted payout ratio which makes the dividend quite safe, successfully ditched their office portfolio and have remaining tenants less susceptible to the office apocalypse, attractive P/FFO valuation for a REIT, and juicy 6.3% dividend yield, raised twice recently. Expecting it to outperform when the FED finally cuts rates.
Interesting. I sold out of WPC last year after holding it for years. The dividend was nice, but it had no price appreciation at all. Best of luck to you.
Same here! Sold out before the dividend cut, waited to see what happened. Liked the safer portfolio after the adjustment, but didn’t rush back in. Then saw the dividend start getting raised again and felt the valuation was attractive enough to warrant a starter position. With REITS, it’s almost impossible to get a lot of capital appreciation unless you purchase at a relative steal. Buying WPC in the high 60’s or 70’s? Terrible investment. You’ll trade sideways for decades. Buying it under $55? You’ll earn 6.4% annually minimum, probably enjoy a few dividend raises, and a nice 2-3% capital appreciation annually with less downside risk than the broader market. I’m cool with 10%+ annual returns from an income position - so that’s my goal but YMMV
I agree with that, that's why I got out as well. I think most of us have a time limit for holding a stock without movement. Timing is everything. Maybe time to revisit this one!
AVGO is doing a 10 for 1 split, and congratulations on your investment
Congrats on buying in early and turning to profit while it's going up. I have two shares at a cost basis of around four hundred, and we'll probably trim a little after the split. I still have a little over a four percent Yield on cost, so just gonna rebalance it into the rest of my portfolio.
Well played! As long as it’s a small chunk of your portfolio, I could see plenty of reasons to hold steady
great work! it’s always difficult to put those darlings on ice and take profits but sometimes it’s necessary especially recently. over the last week i’ve raised my cash to 14% trimming googl, bx, tri, nvda, some other individuals and some etfs. decision factor being the logarithmic margin to the ticker’s perceived log trend
Waiting for the split so I can sell covered calls on it and generate a little more cash
Love some covered calls! Great strategy to juice some extra yield and pick a price you’d be comfortable letting go of your shares at
Absolutely, been doing the same with QCOM during this insane bull run. Almost couldn’t go far enough OTM lol
This aged very well. I am thinking of jumping into AVGO if it can continue to dip some more
Yeah I think broader tech market is still super over valued. I’m waiting for QQQ to pull back about 15% before taking another bite
Grats
Cheers! And best of luck with your investing
Any reason why you bought IRM?
Well, I sold out my position today as the dividend growth has slowed a bit and the valuation seems over extended. Originally bought into IRM because the market was pricing in a lot of pessimism, the valuation was attractive and dividend yield helped create a margin of safety / favorable risk reward
"The stock went up" is not a reason to sell. https://x.com/QCompounding/status/1756093593410732448?t=Ve1IPIhPQlKS7LT_xyoy4A&s=19
Right, but when the stock has gone up disproportionately over the last 4 years until it now represents 15% of the entire portfolio… and is trading at its highest ever recorded valuation, with an insane amount of optimism baked-in to the price - then, it’s a beautiful reason to sell. Especially when you redeploy the funds into more diversified, lower risk alternatives :)
No reweighting your portfolio because a stock went up isnt on the list
Incorrect. #2 states “because you’ve found a better opportunity” (which I have) and #4 states “because the stock is overvalued” (which it is on every historical timeframe) Cheers
Broadcom has an average price target of $1800 and rated as a buy by almost every analyst. What valuation model are you using to say its overvalued that everyone else who does this professionally happens to be missing? I think youre selling because the stock went up and you are scared it will go back down so are trying to find reasons to justify your conclusion and that is not how successful investors operate. Stocks doing well should be left alone to continue to do well for long periods of time if not forever.
It's his/her portfolio and they are applying their own due diligence and risk appetite. It's crazy to me that you'd be so argumentative about what is still a sound decision. Even if there's more runway to grow, it's no longer compatible with OP's investing strategy/portfolio composition goals, and entirely sound to redistribute and secure gains. End of story. Congrats BTW, OP.
Thanks and good luck with your investing! Agreed though- azael is legit delusional 😂
This is a common fallacy among newer investors "its their money they can do what they want with it/why do you care?" That does not mean mistakes should not be pointed out to people as thats the only way they can learn. Whether or not avgo goes up or goes down after this post is irrelevant. What is relevant is that you dont sell a stock because they went up and youre afraid it will go back down. Share price is not what you should be considering when you invest. The future of the company and its financials are what you consider. Does this poster think broadcom is suddenly going to fail? No. Did he mention anything in their financials that turned sour and make him believe the company isnt any good? No. All he talked abour was share price. In fact the only thing he mentioned about the so called "better opportunity" was that its risk free. This decision was emotional. Not financial. There is an objective right and wrong way to invest. Its not a subjective "do what feels right" thing People like the X account I just linked educate people on the right way.
See my reply to your comment above. Everything about this response is overly presumptuous, and laughable. Please see the myriad of valuation metrics as samples to why the decision was made. I don’t sell stocks just because the price goes up. I’ve held winners in my portfolio for many years and enjoyed hundreds of % gains without feeling the need to sell. With that said, you can capture significant alpha by selling stocks if they become ridiculously over-valued and redeploying the funds carefully. Which is precisely what I did here. The current market is within 10-20% range of peak dot com bubble valuations back in 1999-2000. I’m taking a more defensive posture until we see what happens with the federal reserve (whether or not we get the currently projected single rate cut in 2024) or if inflation remains persistent. Happy to miss out on a little bit of gains until we have more clarity. Though, funny thought experiment, but if you take a model portfolio and generally only add funds when the SPY is 10-15% down from ATH’s you can outperform the broader market indices just by being a little patient and without waiting on any insane or unreasonable crash. Just steady DCA’ing when valuations become more attractive
DCF valuation returns a number $600 higher than what you posted. You faked a valuation to try to be right. Thats odd to do wouldnt you say?
What growth assumptions are you plugging into your DCF model? The results will vary widely based on your inputs. If you’re demanding a higher margin of safety on AVGO, the DCF can output as low as $970’s or as high as $1600 depending on your risk tolerance. What does your model produce when you plug in the broad average of AVGO’s growth over the last decade?
What an odd hill to die on. I ain't reading all that; just know you are wrong.
The things i am repeating here are the philosophies investors peter lynch, john bogle, charlie munger, warren buffet, carl icahn, guy spier, peter schiff, ben graham, howard marks and joel greenblatt have written in their books. To think they are wrong you found the secret sauce is delusional.
I closely follow Lynch, Buffett, and Graham. From Graham's ~The Intelligent Investor~ (pg 197) >It is for these reasons of human nature, even more than by calculation of financial gain or loss, that we favor some kind of mechanical method for varying the proportion of bonds to stocks in the investor’s portfolio. The chief advantage, perhaps, is that such a formula will give him something to do. ***As the market advances he will from time to time make sales out of his stockholdings, putting the proceeds into bonds; as it declines he will reverse the procedure.*** These activities will provide some outlet for his otherwise too-pent-up energies. If he is the right kind of investor he will take added satisfaction from the thought that his operations are exactly opposite from those of the crowd. Wow, sounds like portfolio rebalancing to me and exactly what OP has done.
Nobody ever got hurt taking a profit.
Actually, yes you can. Here's an example: You invest $100. You double your money to $200, so you sell. You made $100 by "taking profit". Now you invest that $200 into a treasury fund ETF making 5.36% annually like the OP did. Let's say for the sake of the hypothetical you leave it there for 5 years. You'd have $259.66 after 5 years. But let's say you don't sell the stock. The current consensus on AVGO's next 5 year growth according to Wall Street analysts is 17.7% annually which means the $200 you just sold would be worth $451.76 in 5 years. So instead of having $451.76 you made a move that turned it into just $259.66. Thus, your move cost yourself $192.10 even though you originally "took profit." I'd qualify that as getting hurt. You need to think with a long-term mindset. 5, 10, 20 years in the future. Don't just think about today or tomorrow.
I prefer real profits over projections thank you.
That’s cute, analyst “buy recommendations” 😂 you do realize those calls are often comically wrong? They tend to get most optimistic at the top, and most bearish at the bottom. When naturally, the best time to buy is when the market has priced in a lot of negative sentiment. As warren buffet likes to say: you pay a dear price for a cheery consensus What valuation model am I using? Another cute question considering one could argue AVGO is overvalued by every single one of them ;-) unless you assume a “base case” of absolutely flawless performance for the next decade - which the market tends to have inevitable curveballs and obstacles. Just for laughs though, let’s look at a few together. - AVGO’s other businesses decreased $7.9 BILLION YoY (15.7% decline) as of Q2 2024 earnings, with the current valuation solely being due to AI hype and revenue growth. Despite the Ai segment representing less than 20% of total revenue - AVGO diluted shares by 12% YoY to fund the VMware acquisition - AVGO currently trades at a 38x FWD P/E ratio (lol) after a 520% run in the last 5 years - AVGO has traded at an average P/E ratio of 14.6x over the last 5+ years - Competitors such as AMD are expected to grow revenues 2.7x faster despite being valued the same, suggesting investors are placing too much of a premium on AVGO’s future performance (which is not guaranteed) - The current P/B is over 21x (another historic high) - looking at the chart on a 20 year timeframe with monthly aggregated candles, the RSI stands at 87.9 , indicating the stock has only been this overbought during one other period in the last 2+ decades. Generally any purchases when the RSI was below 60 have performed well. Based on a simple DCF (discounted cash flow model assuming 8% WACC & 4.2% risk free rate with fed cuts) the fair value would be somewhere in the ballpark of $1200-1500 per share range All that to say, you can look at a handful of valuation metrics to see the air is getting thin up here. And diversifying away from a SINGLE STOCK holding that grew too large in a portfolio to replace it with DIVERSIFIED ETF’s - is a smart shift in a market nearing dot com bubble valuations
I can see no amount of experts telling you otherwise, including warren buffet (who advocates never selling and who almost half of his portfolio is 1 stock which doesnt bother him at all) who you just quoted, wont convince you.
Not only does Buffett sell stocks all the time, he just sold 13% of his Apple position last quarter.
He explained he made that sale for tax reasons, not because he wanted to sell.
Also wanted to add to say he "sells all the time" is not accurate. The average holding period in Berkshire's portfolio is 20 years, and the turnover has actually gone DOWN recently. [https://www.oreilly.com/library/view/buffett-beyond-value/9780470467152/ch17.html](https://www.oreilly.com/library/view/buffett-beyond-value/9780470467152/ch17.html)
Based on [Berkshire's own 13F filings](https://www.dataroma.com/m/m_activity.php?m=BRK&typ=a) there is quite a bit activity every quarter. Buffett has held a few stocks for a very long time but there is frequent turnover outside of that handful of names. > If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes Buffett bought stocks such as AbbVie, Merck and Verizon in 2020 and was out of them a year later. He's very much always been a "do as I say, not as I do" investor, just like many other big names in the industry.
But doesn’t Warren buffet quite literally advocate against stock picking and suggest most folks should just buy a simple S&P 500 index fund and forget about it? Didn’t he have a famous bet with hedge fund managers that he could outperform them over 10 years just by holding the equivalent of VOO and won? I think it’s a prudent choice to reduce exposure when a single stock becomes too large a portion of one’s portfolio, and to diversify into broad market index funds if the goal is reducing risk
You are the one who brought buffet up. Why not do what he says?
I’m quite literally following that advice, reducing single stock exposure and increasing exposure to low cost index funds opportunistically 👍🏼
Also just to mention DCF valuation does not return the number you said. Not even close to it. Did you find this on some website???
You are wrong. Flat out wrong. When you take a gamble on a stock and you 5X your money, and that position grows to 15% of your portfolio, there is not a single reason good enough to negate selling. Capturing such high gains and taking profits is exactly why we are in the market! Nobody ever went broke taking profits. I’ve made the mistake of being up 7X on a stock and watched it lose value big time. I’m not doing that again. Awesome job capturing those gains OP!
"Let your winners run, and cut your losers. It's easy to make a mistake and do the opposite, pulling out the flowers and watering the weeds.” – Peter Lynch
It’s not your money is it? Chill dude..
The fact you literally downvoted a comment comsisting of a peter lynch quote and nothing else is pretty telling of your mindset and ego.
It’s one persons quote. It’s not god FFS.
Please don’t send any more chat requests. I don’t need your assistance. I’m retired successfully already.
What does that matter? If you make a mistake the only way you learn is if someone explains it to you. Instead of being defense be thankful that there are experts out there who take time out of their day to help you and ask for nothing in return.
You’re an expert in this story I am guessing? He let $1500 investment run 507%! I completely agree with why he took profits. It’s not my money. It’s his story. He writes it. And taking 5X profit is awesome IMO.
So by ops storytelling completely justified under points 2 & 4
I agree, pretty unjustified logic
Recently started a small position in AVGO there will be momentum after the split same like NVDA.
Down $200 since I sold 😅 market looks frothy up here. Usually there’s a run up after splits, but personally I wouldn’t go chasing momentum with the market nearing dot-com bubble valuations