Selling Amazon?

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
CnC
Posts: 528
Joined: Thu May 11, 2017 12:41 pm

Selling Amazon?

Post by CnC » Wed Jun 20, 2018 3:22 pm

Just wondering what some opinions here are on selling Amazon.

I have ±90% of my stock money in index funds both forign and domestic. But when I first started out investing a year ago it was with Ed Jones and their "diverse portfolio" approach was to get me to pick stocks with and pay an obscene charge to buy them.

Luckily the fees were high enough to shock me into doing some research which brought me here yet on a small enough amount of money it didn't really hurt me.

Long story short we have some individual stocks ±2000-5000 in I plan on selling most of them but was planning on keeping my biggest loser (GE) as a cautionary tale since it's worth very little now.

But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future.

As I said this is a relatively small portion of my portfolio 11k out of >500k which we keep adding to every paycheck but I'm not sure if I should cash out or let it ride.

I assume the majority of responses will be sell everything and invest all your stock allocation in the total market. But I'm going to ask anyway.

User avatar
Pranav
Posts: 226
Joined: Thu Aug 25, 2016 11:25 am
Location: Texas

Re: Selling Amazon?

Post by Pranav » Wed Jun 20, 2018 3:32 pm

Invest stock allocation in the total market.
https://www.bogleheads.org/wiki/Main_Page

User avatar
David Jay
Posts: 5157
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Selling Amazon?

Post by David Jay » Wed Jun 20, 2018 3:40 pm

Selling GE (or at least most of it, if you want to keep a reminder of single-stock risk) at a loss in the same year as selling stocks with gains will be an offset - reducing your tax bite.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

Darth Xanadu
Posts: 339
Joined: Sat Jan 27, 2018 1:47 am
Location: Middle Earth

Re: Selling Amazon?

Post by Darth Xanadu » Wed Jun 20, 2018 3:55 pm

I've hung onto all my individual positions unless or until there's an opportunity to harvest losses and doing so otherwise makes sense to me in light of other tax activity I'm considering or have previously executed during the year. Almost all new money goes into total market index, international index, or total bond fund. With only once exception, each of my individual positions is worth less than 1.5% of overall portfolio, and will shrink even further over time.
My friends said stick to your guns, but instead I just got stuck.

CnC
Posts: 528
Joined: Thu May 11, 2017 12:41 pm

Re: Selling Amazon?

Post by CnC » Wed Jun 20, 2018 4:02 pm

David Jay wrote:
Wed Jun 20, 2018 3:40 pm
Selling GE (or at least most of it, if you want to keep a reminder of single-stock risk) at a loss in the same year as selling stocks with gains will be an offset - reducing your tax bite.
Luckily (relatively speaking) get was in taxable so I will be able to sell to offest gains. But Amazon is being held in a Roth account. (wife's actually) but she has no opinion at all in the matter.

KlangFool
Posts: 9155
Joined: Sat Oct 11, 2008 12:35 pm

Re: Selling Amazon?

Post by KlangFool » Wed Jun 20, 2018 4:08 pm

CnC wrote:
Wed Jun 20, 2018 3:22 pm

Long story short we have some individual stocks ±2000-5000 in I plan on selling most of them but was planning on keeping my biggest loser (GE) as a cautionary tale since it's worth very little now.

But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future.
CnC,

1) If you sell the GE stock, you can harvest the loss and deduct your taxable income.

<<But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future. >>

2) That is not the right question. The correct question is can it doubles in the future. If yes, when?

3) I only buy individual stock may return 10X to 30X in the future. Anything less than that, it is not worth my effort.

KlangFool

dekecarver
Posts: 250
Joined: Mon Feb 22, 2010 10:24 am

Re: Selling Amazon?

Post by dekecarver » Wed Jun 20, 2018 6:59 pm

KlangFool wrote:
Wed Jun 20, 2018 4:08 pm
CnC wrote:
Wed Jun 20, 2018 3:22 pm

Long story short we have some individual stocks ±2000-5000 in I plan on selling most of them but was planning on keeping my biggest loser (GE) as a cautionary tale since it's worth very little now.

But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future.
CnC,

1) If you sell the GE stock, you can harvest the loss and deduct your taxable income.

<<But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future. >>

2) That is not the right question. The correct question is can it doubles in the future. If yes, when?

3) I only buy individual stock may return 10X to 30X in the future. Anything less than that, it is not worth my effort.

KlangFool
Would you mind throwing out a proverbial bone, I'd be happy with a potential 20x future :D

KlangFool
Posts: 9155
Joined: Sat Oct 11, 2008 12:35 pm

Re: Selling Amazon?

Post by KlangFool » Wed Jun 20, 2018 7:12 pm

dekecarver wrote:
Wed Jun 20, 2018 6:59 pm
KlangFool wrote:
Wed Jun 20, 2018 4:08 pm
CnC wrote:
Wed Jun 20, 2018 3:22 pm

Long story short we have some individual stocks ±2000-5000 in I plan on selling most of them but was planning on keeping my biggest loser (GE) as a cautionary tale since it's worth very little now.

But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future.
CnC,

1) If you sell the GE stock, you can harvest the loss and deduct your taxable income.

<<But looking at selling Amazon, I have literally doubled my money since buying it and I really believe that the company will continue to dominate for the foreseeable future. >>

2) That is not the right question. The correct question is can it doubles in the future. If yes, when?

3) I only buy individual stock may return 10X to 30X in the future. Anything less than that, it is not worth my effort.

KlangFool
Would you mind throwing out a proverbial bone, I'd be happy with a potential 20x future :D
dekecarver,

1) Do not gamble more than 5% of your portfolio or 5K in total to individual stocks. Whatever smaller in number.

2) Only buy US stock with capitalization less than 1 billion.

3) When the stock triples, sell 50% of the stock and lock in the gain.

KlangFool
Last edited by KlangFool on Wed Jun 20, 2018 7:37 pm, edited 1 time in total.

md&pharmacist
Posts: 262
Joined: Fri Mar 23, 2018 7:05 pm

Re: Selling Amazon?

Post by md&pharmacist » Wed Jun 20, 2018 7:15 pm

High quality actively managed technology/internet, healthcare/biotech, semiconductor, China mutual funds. Let the pro's go in and out of stocks. They do the stock research we don't. Buy the funds on market corrections.

You'll continue to way outperform the indexes barring a major market disruption.

ccf
Posts: 106
Joined: Mon Mar 09, 2015 9:13 pm

Re: Selling Amazon?

Post by ccf » Wed Jun 20, 2018 7:19 pm

CnC wrote:
Wed Jun 20, 2018 3:22 pm
As I said this is a relatively small portion of my portfolio 11k out of >500k which we keep adding to every paycheck but I'm not sure if I should cash out or let it ride.

At 2% of your portfolio, I think either option is totally fine but if you let it ride, consider making plans / getting an Investment Policy Statement down in writing. I'd include these things:

* If not now, when will you sell?
* How much will you allow this to grow (as a percentage of your portfolio)
* If you buy more individual stocks, where will the money come from (I'd suggest that the correct answer is... only from selling some of your existing individual stocks ;) )

I personally like having a tiny bit in individual stocks with rules/plans like the above because it gives me an outlet when I am tempted to do stupid things.

LFKB
Posts: 487
Joined: Mon Dec 24, 2012 7:06 pm

Re: Selling Amazon?

Post by LFKB » Wed Jun 20, 2018 7:34 pm

Pranav wrote:
Wed Jun 20, 2018 3:32 pm
Invest stock allocation in the total market.
It's okay to live a little

Most of my portfolio is in indexed funds, but all of my individual holdings have absolutely crushed my index holdings
Amazon, Google, NVIDIA and IQ I still own and have all killed it for me

Whole Foods - bought shortly before Amazon deal and made 40% over a few months
Dick's - owned it for a year and made about 70%

MotoTrojan
Posts: 1711
Joined: Wed Feb 01, 2017 8:39 pm

Re: Selling Amazon?

Post by MotoTrojan » Wed Jun 20, 2018 7:36 pm

I think you’d be hard pressed to find anyone that thinks Amazon won’t dominate, but that’s already priced in. Companies that do exceptionally well in market cap growth didn’t do better than other companies, they do better than they were expected to.

At 2% you aren’t even that far off from the amount a Total US fund would have so it really doesn’t matter much. Perhaps set a limit order (50% growth) and if it arrives there, reinvest in your indexes.

limeyx
Posts: 185
Joined: Wed Sep 07, 2016 5:34 pm

Re: Selling Amazon?

Post by limeyx » Wed Jun 20, 2018 7:39 pm

I just sold my remaining AMZN, GOOGL, AAPL that my old planner had us in.
Waited until the LTCG date and just sold the lot. Not much in total ~$18,000 but now trying not to watch it go up faster than everything else I hold while not wanting it to come down and bring everything else with it !

bltn
Posts: 118
Joined: Mon Feb 20, 2017 9:32 pm

Re: Selling Amazon?

Post by bltn » Wed Jun 20, 2018 9:27 pm

Id keep that amount but resist any thoughts of adding to it . Amazon will probably match the market, at least, over the years. Don t think about adding other individual stocks, no matter how well this one does.

User avatar
peterinjapan
Posts: 392
Joined: Fri May 15, 2015 8:41 am
Location: Japan!

Re: Selling Amazon?

Post by peterinjapan » Wed Jun 20, 2018 9:54 pm

It will go up, for sure. Just as when I finally sold my MCD holdings, sure it wouldn't go any higher, and it went up 12% immediately after.

bradpevans
Posts: 206
Joined: Sun Apr 08, 2018 1:09 pm

Re: Selling Amazon?

Post by bradpevans » Wed Jun 20, 2018 9:55 pm

Darth Xanadu wrote:
Wed Jun 20, 2018 3:55 pm
I've hung onto all my individual positions unless or until there's an opportunity to harvest losses and doing so otherwise makes sense to me in light of other tax activity I'm considering or have previously executed during the year. Almost all new money goes into total market index, international index, or total bond fund. With only once exception, each of my individual positions is worth less than 1.5% of overall portfolio, and will shrink even further over time.

If owning individual stocks is part of your plan,I say Keep it. Amazon isn’t going away. The whole “locking in profits” sounds great. It’s often locking in lesser gains later. What I mean is once you sell, unless you need the prceeds, you then buy Something else that you hope does better

blackburnian
Posts: 46
Joined: Thu May 04, 2017 12:40 pm

Re: Selling Amazon?

Post by blackburnian » Wed Jun 20, 2018 9:59 pm

I've been wondering the same thing. I inherited 20 shares of AMZN about 1.5 yrs ago, and it has tripled in value since then. I decided to sell in 2-share increments bit by bit (to keep it at fixed percentage of my allocation) and reinvest in index funds (which is what I've already done with the other stocks I inherited), but it's definitely hard to sell it and then watch the value continue to increase.

User avatar
Starchild
Posts: 70
Joined: Fri Feb 09, 2018 9:01 am

Re: Selling Amazon?

Post by Starchild » Thu Jun 21, 2018 2:15 am

Keep it. What harm is there in doing so? You invest in companies you believe in.

Post Reply