Ask The Compound

Is It Time to Take Some Profits?

7 snips
Oct 15, 2025
Josh Brown, an experienced equity investor and industry commentator, dives into the art of taking profits after big market rises. He explains how to differentiate between investments and trades, advising on when to hold or sell after rapid gains. The discussion also tackles the complexities of asset allocation for those receiving an inheritance and outlines strategies for middle-aged investors navigating their financial planning. With practical insights on trimming high-performing stocks, Josh shares valuable wisdom for all types of investors.
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ADVICE

Decide Investment Vs Trade Up Front

  • Decide whether a purchase is a long-term investment or a trade before you buy a stock.
  • If it was a trade, use predefined exits; if it was an investment, let winners run unless fundamentals change.
ANECDOTE

Holding Through Uber's Big Drawdown

  • Josh bought Uber at low prices and treated it as a long-term investment despite early losses.
  • He stayed through a 50% drawdown and did not sell when it rebounded strongly.
ADVICE

Manage Winners With Trailing Stops

  • Avoid arbitrary concentration caps on individual winners; prefer risk management tools tied to the position.
  • Use trailing stops or technical rules to protect gains while letting compounding continue.
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