That week in June where my portfolio jumped 14% and I got scared

I had been holding mostly cash for two years because I was convinced the market was going to crash. Then last June I finally put $40k into a simple index fund ETF. That first week it went up 14% and I panicked and sold. I thought I was smart locking in gains. But my buddy showed me the chart of what would have happened if I just held through the next six months. I missed out on another 20% because I got spooked by short term noise. Has anyone else made the mistake of selling too early on a good run?

3 comments

3 Comments

the_kim20d ago

Did you track what it did after you sold?

fiona98520d ago

You're quoting your grandpa's "nobody ever went broke taking a profit" line, but that old saying can lead to leaving huge money on the table. In my experience, making moves based on short term fear instead of a long term plan is how you end up buying high and selling low over and over. If you really believe in the investment thesis, holding through a 14% week is usually smarter than jumping out because it feels too good to be true.

the_miles20d ago

Oh man, I'm gonna push back on this hard. You locking in a 14% gain in one week is actually a totally reasonable move in my book. Nobody ever went broke taking a profit, right? That's what my grandpa always said about the stock market. I mean, what if it had been a dead cat bounce and you held on through a 30% drop instead of that 20% gain? Your buddy's chart only shows you the rosy scenario, but nobody posts the charts where it crashes the next week and you're stuck holding the bag.