High Valuations, page-8

just for example purposes, one has bagged out many times on the one stock, the investor re-evaluates the company and, hearsay less than expected has happened, the same investor may turn to a TA and see indicators that suggest overbought etc, decides to sell the bags as price is quite high on short term fundamentals for example say. The same investor then with his bags of profit consults his watch list and now has purchased an Energy, Financial, ETF, or other play. This investor now has a more diversified portfolio paid for from profits and still exposed albeit free carrying to his her original play.
Easy peasy stuff.