When to Sell Stocks: Key Signs It's Time

WHEN IS IT TIME TO SELL STOCKS?
By www.ProfitableInvestingTips.com

http://profitableinvestingtips.com/stock-investing-tips/when-is-it-time-to-sell-stocks
Anyone who invested in the Chinese
stock market a year ago probably saw
their investment go up very nicely.

That is until the twenty percent across
the board losses in the last couple of
weeks.

Click the links below to get your
FREE training materials.
Free Weekly Investing Webinars
Don’t miss these free training events!
http://www.profitableinvestingtips.com/free-webinar
Forex Conspiracy Report
Read every word of this report!
http://www.forexconspiracyreport.com
Get 12 Free Japanese Candlestick Videos
Includes training for all 12 major candlestick signals.
http://www.candlestickforums.com
Before We Continue…

There was a huge disconnect
between the slowing Chinese
economy and the rise in the Chinese
stocks in the last year.

Nevertheless investors saw huge
gains. The problem in a rising market
is to know when it is time to sell
stocks.

Even the likes of Warren Buffet, the
penultimate buy and hold investor, sell
stocks.

His take on things is that when he no
longer understands how the company
will make money to support its stock
price it is time to get out.

This is the fundamental
analysis approach.

Knowing the intrinsic value of your
stocks is critical for knowing when to
buy and knowing when it is time to
sell stocks.

Intrinsic Stock Value

Intrinsic stock value is the expected
company cash flow discounted to
current dollars. It is a discounted cash
flow valuation.

An inherent weakness in this concept
is that too often the medium and long
term prospects of a company and its
stock price are not clear.

So, what is intrinsic stock value of a
company if the future is uncertain?

The ability to see into the future to see
how well a company will manage its
assets, products, costs, R&D, and
marketing is of utmost importance in
calculating intrinsic stock value as a
means of deciding whether or not to
purchase a stock.

When an overly enthusiastic market
drives prices substantially higher than
the intrinsic value of a stock it is most
commonly time to sell stocks.

Timing the Market

The point of investing in stocks is to
make money and to keep that money.

Many investors do not subscribe to a
buy and hold approach.

Rather they look for value, often using
the intrinsic value approach, and buy
when they believe that the market will
recognize the value of a stock and
drive its price up.

The same investors look for takeover
targets.

The Google purchase of Motorola,
its cell phone division, a few years
ago was classic.

Carl Icahn had purchased more than
eleven percent of Motorola shares in
an effort to force the company to
provide more value for its investors.

The value that Google purchased was
the treasure chest of patents from the
company that basically invented the
cell phone.

It their fight to protect their
development of the android operating
system this was of great value to
Google.

The point of this example is that
anyone who invested in Motorola in
the run up to the acquisition of the
mobility division by Google made
money.

Thereafter it was time to sell Motorola
stock and look for other investment
opportunities.

When a Stock No Longer
Fits Your Portfolio

When an investor is approaching
retirement it is time to start
adding dividend stocks to his
portfolio and remove risky growth
stocks.

When you are younger you have time
to make up for mistakes.

When you are retired you want steady
income a good night’s sleep.

It is time to sell stocks when they no
longer fit the design of your portfolio.

When to Sell Stocks: Key Signs It's Time

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Ähnlich wie When to Sell Stocks: Key Signs It's Time

Ähnlich wie When to Sell Stocks: Key Signs It's Time (20)

Mehr von InvestingTips

Mehr von InvestingTips (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

When to Sell Stocks: Key Signs It's Time