Hi Guemar,
I only sold a few to pay some bills. Tiny fraction of my holding.
With hindsight, everything is easy, of course!
Here are some thoughts on your question…
If I had my time again, I would do the same, as I can only base my decisions on what I know at the time, and the associated analysis and assessment.
You can’t go back in time with today’s knowledge and make a better decision!
As I have mentioned before, selling to take or preserve profits etc depends on individual circumstances. For some people, substantial tax obligations upon realisation of capital gains complicates things - for example, for some it means that selling because it “should drop a bit” isn’t reason enough…. For some it needs to drop rather significantly to cover tax obligations and rebuild an equivalent position to actually be better off in the long run. In such a case, one would need to be very confident of a significant price drop (approaching 50% in some cases!) for someone to “get ahead”. This of course depends on individual circumstances and ultimate exit strategies.
For me, I was not veryconfident of a significant price drop from 80c. Whilst of course it is always possible, and fluctuations are always to be expected, being veryconfident of such an outcome is totally different.
It also depends on one’s original investment thesis and what they expect from the company in their investment horizon.
Sometimes the evidence and analysis at the time does not justify making what subsequently could be seen as a “better” choice.
Hence my earlier example of Bazza and the roulette wheel - despite 17 coming up last spin, the case to put the house on 17 did not stack up, despite that ending up being the “better” choice. Why would anyone beat themselves up for not putting the house on 17? Technically, not picking 17 was “wrong”, but any reasonable assessment could not justify being very confident of landing 17.
I see similarities of this simplified risk example with stock picking and timing, one needs imo to simply act on the balance of evidence, analyse and accept risk, and understand that there is often NOT adequate information to always make the “right” choice even if you have phenomenal analytical capability to assess the info available.
We all assemble our own jigsaw that allows us to evaluate things like potential and likelihood, and to me it makes sense to act on that assessment. You cannot get it “right” every time, but thankfully I don’t need to predict or time the waves here in order to be ultimately very successful, and that is the basis of my investment here - essentiall backing a company that my DD indicates can become a successful producer.
So, to your point about why I did “not see what I should have done at the time”…..
For me, I acted on my assessment, and based on my personal financial circumstances and investment strategy. With hindsight, it dropped enough for me to have been better off had I sold all at 80, sure, but for me, at the time, that was not an outcome that I had high confidence in. For ME, it was too risky at the time, despite it ultimately occurring.
Could I have had high confidence in that, had my analysis and assessment been “better”..?? That’s the 10-million dollar question!
Another way to look at this is WHO - at the time - put forward a detailed, overwhelmingly convincing analysis that showed pricing was very likely to collapse as it did, and take share prices with it, as it clearly ended up doing…? I can’t think of anyone, anywhere, afaik, who put forward such a case.
So, I rest easy knowing that I made a choice to hold, at the time, that was based on my assessment and expectations, and no-one, afaik, had a convincing case that would have triggered a risked decision for me to sell and be better off for my personal circumstances in the long term.
To the broader point I think you’re making - what can we learn for “next time”?…. Well, imo it is a good reminder that product and share prices can be pushed/pulled to extreme levels due to many factors, but I’m not sure that there are specific learnings wrt a specific time or price that a future action should/shouldn’t be taken, as future price action will also depend on new factors and circumstances! That’s what keeps it challenging and interesting!
Imo people need to be more accepting of volatility, and longer-term investors need to assess and reassess their investments based on their orignal investment thesis and look for the emergence of dealbreakers that may kill the plan.
Are you aware of something that you missed, at the time, that “should have” triggered you to sell some at the 80 level..? Is there anything that you’ve “learnt” for next time..?
Anyway, just food for thought.
Imo
Not advice
Dyor
Cheers
Expand
