Ask The Compound
When to Sell Your Big Winners
Oct 9, 2024
Nick Maggiulli, COO of RWM and author of "Just Keep Buying," brings his financial expertise to a lively discussion. They explore the differences between bull and bear markets, dissecting what each means for investors. Maggiulli shares insights on managing small-cap investments and evaluating pensions. The conversation also delves into the psychology behind selling big winners like NVIDIA, highlighting the emotional factors that can sway decisions. Be prepared for eye-opening strategies on when to take profits and navigate market cycles!
31:59
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Quick takeaways
- Understanding the distinction between secular and cyclical markets is essential for investors navigating both long-term trends and short-term fluctuations.
- Developing a disciplined strategy for selling high-performing stocks can alleviate investor anxiety and improve long-term investment outcomes.
Deep dives
Understanding Market Cycles
The concepts of secular and cyclical bull and bear markets play a crucial role in understanding market trends. Secular markets refer to long-term trends, while cyclical markets are shorter-term fluctuations within those trends. The recent discussion suggests that market definitions are not standardized; for many investors, a bear market begins with a 20% decline. Despite experiencing downturns in 2020 and 2022, the broader trend since 2009 is classified by some as a persistent bull market due to the overall upward trajectory on a secular basis.
