HIGH RISK OF TAKEOVER, page-157

There is a lot of misinformation on this thread. Some posters seem to think that holding long term (like Buffet does) is the Holy Grail and the key to investing. If it was this simple, any investor could simply buy any stock, hold long term and provided they held for long enough they would make money.

This is not how it works.

You need to (i) buy the right stocks and (ii) buy these right stocks at a reasonable price.

If you buy a dud, it doesn't matter how long you hold it, it will likely still be a dud. Similarly, if you buy a good stock but pay 10x what it's really worth, it's unlikely that you will make a profit (your grandchildren may when they eventually sell).

Buffet makes money since he buys good stocks (typically with a history of reliable earning) at a reasonable price. He then holds these (often long term) and earns dividends.

For me personally, my investment performance has improved dramatically over the last 3 years since I have started to sell progressively. So, for example I may buy into a stock I believe is undervalued. Then, if the stock price rises say 50% I may sell say 20% of my holding. If it rises a further 50% I may sell another 20% of my holding etc. This strategy has worked very well so far and often the share price starts to retreat before I have sold all of my holding. In this case, if I still believe in the story, I may buy back in when the share price has retreated back to what I judge to be good value again.

This strategy of progressively taking profits (and using the profit to buy other stocks that I consider undervalued) has worked very well for me versus simply holding the stock indefinitely.

GLTA & DYOR