When to Sell a Stock 📉🤔? (part 1)

Sleep Well Investing 🛌 Post 44: When to Sell a Stock? This question has haunted me forever! What about you? Have you ever struggled with when to sell? Share your experiences in the comments — we all learn better together! ("ज्ञान बाँटने से बढ़ता है")

𝐒𝐞𝐥𝐥𝐢𝐧𝐠 𝐒𝐜𝐢𝐞𝐧𝐜𝐞 𝐢𝐬 𝐝𝐞𝐩𝐞𝐧𝐝𝐞𝐧𝐭 𝐨𝐧 𝐲𝐨𝐮𝐫 𝐡𝐚𝐧𝐝, today we are going to address the scenario - Where you own a Wonderful Quality Business at a decent price (assuming you did a good job in Buying it)

𝐓𝐡𝐞 𝐢𝐝𝐞𝐚𝐥 𝐚𝐧𝐬𝐰𝐞𝐫 𝐢𝐬 𝐍𝐄𝐕𝐄𝐑 🚫 - Imagine buying a prime piece of real estate — say, a building near Times Square in NYC,🗽, Nariman Point in Mumbai 🇮🇳, Silicon Valley in San Francisco 🌉, or Mayfair in London 🇬🇧 . Would you ever sell it? Probably not, because its value appreciates 📈 over time, and it provides a steady stream of rental income💰. Similarly, a great company that continues to grow, innovate, and generate increasing cash flow is like a prime real estate asset. If the fundamentals remain strong and the company keeps delivering value, selling would mean giving up future gains and missing out on generational wealth opportunity 🌱💎.

Think about it— 𝐄𝐯𝐞𝐫𝐲𝐨𝐧𝐞 𝐈’𝐯𝐞 𝐦𝐞𝐭/𝐥𝐢𝐬𝐭𝐞𝐧𝐞𝐝 𝐭𝐨/𝐫𝐞𝐚𝐝 𝐡𝐚𝐬 𝐑𝐄𝐆𝐑𝐄𝐓𝐓𝐄𝐃 𝐭𝐡𝐞𝐢𝐫 𝐒𝐄𝐋𝐋 𝐃𝐄𝐂𝐈𝐒𝐈𝐎𝐍𝐒 😞It starts from Warren Buffett, Charlie Munger, all Super Investors, grandfathers, fathers, and even you.

𝐖𝐚𝐫𝐫𝐞𝐧 𝐁𝐮𝐟𝐟𝐞𝐭𝐭 famously admitted that selling Disney 🎬 in 1966 was one of his biggest mistakes. Had he held onto his stake, it would be worth tens of billions today.Buffett sold shares of Walmart 🛒 too early. The company went on to multiply in value, and he missed out on enormous gains.

𝐂𝐡𝐚𝐫𝐥𝐢𝐞 𝐌𝐮𝐧𝐠𝐞𝐫 often spoke about the pain of prematurely selling great businesses. His philosophy was simple: “The first rule of compounding is to never interrupt it unnecessarily.”

𝐒𝐮𝐩𝐞𝐫 𝐈𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬 𝐥𝐢𝐤𝐞 𝐏𝐚𝐭 𝐃𝐨𝐫𝐬𝐞𝐲, 𝐏𝐞𝐭𝐞𝐫 𝐋𝐲𝐧𝐜𝐡, 𝐚𝐧𝐝 𝐌𝐨𝐡𝐧𝐢𝐬𝐡 𝐏𝐚𝐛𝐫𝐚𝐢 𝐡𝐚𝐯𝐞 𝐚𝐥𝐥 𝐞𝐱𝐩𝐫𝐞𝐬𝐬𝐞𝐝 𝐬𝐢𝐦𝐢𝐥𝐚𝐫 𝐫𝐞𝐠𝐫𝐞𝐭𝐬. Lynch, who ran the Magellan Fund at Fidelity, once said, “The real key to making money in stocks is not to get scared out of them.” Many investors, including himself, have sold too soon, only to watch those stocks skyrocket 🚀 later..

Think about your own experience or someone in your family—your grandfather, your father, maybe even you. Ever sold a stock, a property, or a business too early, only to watch it multiply in value over the years? That feeling of REGRET 😞 is universal.

𝐒𝐨, 𝐭𝐡𝐞 𝐧𝐞𝐱𝐭 𝐭𝐢𝐦𝐞 𝐲𝐨𝐮 𝐭𝐡𝐢𝐧𝐤 𝐚𝐛𝐨𝐮𝐭 𝐬𝐞𝐥𝐥𝐢𝐧𝐠, 𝐚𝐬𝐤 𝐲𝐨𝐮𝐫𝐬𝐞𝐥𝐟: Would you sell your prime real estate in Times Square? Would you give up on an asset that keeps growing in value?

If not, then why sell a great business that is compounding your wealth? Just as you'd think twice before selling a prized property in an iconic location, you should carefully evaluate whether there's a compelling reason to sell a stock in a high-quality business

But things change in Business and this is where one needs to be HUMBLE and get better PERSPECTIVES. Markets are dynamic - A lot of companies go and come, Remember - the only companies that survive are the ones that provide a lot of value to their customers, Customers love them, their services are ingrained in their workflows/lives, In Return customers vote by paying dollars for their services and value they derive.

More insights coming soon in Part 2!

-------------------------------

Interested to join Sleep Well Investing 🛌 and our goal is to compound at a better rate than the S&P index, I am looking for my Charlie... Do you want to Join me! 🤿

💜 Become Business Pickers vs Stock Pickers 💜

🙏 Remember, nothing here is new. These principles have existed since the stock market began. I'm just sharing lessons from my 10+ years of investing experience.

This article has been produced only for educational purposes, Please do you due diligence, No recommendation or advice is being given as to whether any investment is suitable for a particular investor