The Poseidon story is relevant to the point that if you do not sell because of tax implications, when a stock is well overpriced, you risk a price reversal & you have gained nothing.
I have another story. I bought Babcock & Brown shares on the float at, I believe, was $5.00 per share. I think I had 10,000 shares. During their trading I made a calculation, based on length of waves, that indicated that the share price would reach $38.00. The shares did actually reach $38.00, promptly reversed & finished up at zero. I was too busy at the time when they hit $38.00 & did not believe that the price would continue down & I did not sell. This is another example of not taking a profit when you have worked out when you should have sold. Yes, I had $380,000 worth & finished up with nothing.
CBA is overbought & whether you are holding or buying, the return from now on will not be worth the investment. The yield is 3.2% & little prospect of any meaningful dividend improvement which means the share price will stall. Once that happens, shareholders will start looking elsewhere & the share price will fall to a point where the yield is more attractive.
CBA Price at posting:
$144.00 Sentiment: Sell Disclosure: Held
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