Knowing When to SELL
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In the high-stakes arena of equity investing, a persistent paradox haunts even the most accomplished portfolio managers: while mountains of research, analysis and debate are devoted to the art of buying, shockingly little discipline is applied when it comes to the selling of stocks. Analysts craft elaborate discounted cash flow models to justify an entry price; they rarely build a corresponding framework for the exit. Yet it is an immutable truth of the market: profits are purely theoretical until the position is liquidated.
In the high-stakes arena of equity investing, a persistent paradox haunts even the most accomplished portfolio managers: while mountains of research, analysis and debate are devoted to the art of buying, shockingly little discipline is applied when it comes to the selling of stocks. Analysts craft elaborate discounted cash flow models to justify an entry price; they rarely build a corresponding framework for the exit. Yet it is an immutable truth of the market: profits are purely theoretical until the position is liquidated.
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