It will come the moment in our journey when we will have to make a decision of selling some of our investments, because we make a mistake selecting one, because we find another one that fits better, or for any other reason.
As we said when we were deciding when to buy, we have things that we must do, and things that we must avoid.
The things that we must do depend on the type of investment:
For the funds, we will be mainly selling when we are rebalancing our investments. We will have set an action plan with the amount that we want to have for each investment, and we will choose the time as we have already explained.
For the shares and bonds, is again a bit more difficult. If we hold shares, we must to monitor the indicators that we have explained in how to pick a share and how to pick a bond. It could be that these indicators are not what we expected or are underperforming. If that happens, we have to sell as soon as we can.
The last thing you can to look at, for both funds and individual shares and bonds, are when there is an exagerated market euphoria. This can open a window of opportunity and give you the possibility of selling those investments that you have already planned to sell, at a better price.
On the other side, the things that we must not to do , we can identify:
Look constantly at the highs and lows of the prices and try to find the best day to sell based on past statistics or premonitions.
Wait until an investment tops a price because you believe that it will reach that price, or because the technical analysis gives you that estimation
Having a share or bond that we don't want to hold anymore and where you have already loses, and wait until increases it's price, as it's likely that it will not only rise its price but it will keep going down.
Remember that having a plan and following it is a very important part of the #imap philosophy.
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