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Anybody taking a little CNXS off the table? These shares have had a nice run and are sitting near their 52 wk high (I think all time high too!). I am thinking of selling a third of my position...

--beaker
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Just as an FYI...

That was exactly my sentiment when I sold 1/2 of my position about a year ago at $12. "Doh!"

Learning to Let His Winners Run,

Blitzen94
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In reading several of TG's recommended books plus several others, I have not yet seen where anyone has done a study of stocks that have hit their 52 wk highs and found evidence that they are more likely to go down than up from these highs.

Why dump a good stock? I'm thinking more of dumping my ESPD or QLTI and buying more CNXS with the proceeds.

charlie -- long all three of these
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Beaker,

I have a position with CNXS and have not considered profit taking at this point. It does not look overpriced to me, though I would not be surprised to see a small pullback.

In general, I only harvest when I am compelled to open or add to a position in another security. I recently did this with ~ 25% of CRYP to open a position in Montpelier RE.

If you are worried about locking in some gains while they are available, consider a stop loss on a portion of your shares. If they begin to drop, you will lock in some profits, while maintaining most of the holding. I do this occasionally, but generally not in taxable accounts where I want to keep trades to a minimum (preferably just buys - but ...).

No right or wrong answer.

Good luck

Zuzufool (R)



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CNXS shows the rewards of patience. The stock went down or sideways for many months, to the extent I had my finger on the sell button a number of times. But I never pushed it. Thank goodness--look at it now!

Raleigh1208
--long on CNXS
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Already burned. I bought at $10ish, and unloaded 2/3 at about $15, thinking I'd buy back again under $13. Well, you know how that went. I'm just thankful I'm still holding my original third.

Honestly, if I still had the whole wad, I'd unload a third at $20. It may not be right, but I would probably do it.

The valuation is still not crazy high after this run. And I like CNXS long term. Which are good reasons to hold. My crystal ball says it won't hold at $20, but, you know, my crystal ball said the same thing at $15.

Hmm. Tough call. Good luck.
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Hi Charlie.

I would not dump here just because the stock it a 52-week high; you probably have the right idea in dumping some "junk" and buying more quality.

Logically, if a stock is doing so well that it reaches its 52-week high then it is more likely that it will continue to move up. Just as a stock that has recently hit a 52-week low, is more likely to continue that trend. Of course, this is not to say that both are likely to continue forever in that direction... Basically, the law of physics: an object in motion will tend to stay in motion and an object at rest will tend to stay at rest, is true also of stock movement, particularly when a stock is at its extremes. For example, MRK or FMN both hit 52-week lows on one-day huge moves. I bought both on those days. Both continued to drop...as expected. However, I had no idea how far they would continue to fall or how long they would stay down, but I was/am confident that both were unjustly beaten down by Mr. Market and would indeed turn around. Both continued to set new 52-week records on the low side until they leveled off and started to move back up.

In hindsight, it would have been much wiser to have waited longer on FNM...patience truly is a virtue and often a difficult virtues for me.

Highs work pretty much the same, the only exception is that one KNOWS that sooner or later the stock will retreat; with lows the company can continue to drop until it no longer exists - for ex. HOME.

Anyhow, LTBH allows people not to have to worry about it! Well, at least not too much. ; )

tim
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Thanks Everyone! It's great to hear all of you responses. It's so fascinating how (at least for me) the selling of stock is so much more complicated than the buying. I feel very comfortable buying stock, I've been buying in thirds and feeling like this provides me with as decent a margin of safety as is possible, as well as gives me an incentive to learn more about a company and simply get more comfortable with understanding the stock price fluctuations and general value of a company.

Selling, however, is an entirely different ballgame. When people sell in this community are they selling in thirds as well? Seems like a reasonable idea. More often than not when I have sold, it has been to dump all shares of a company that has had some very bad news or because I do not believe in the company any more. I have rarely sold to “lock in” profits. This seems to be more of trader mentality, but also seems rather prudent if you have had a nice run up. I know you want to let your winners run, but the flip side is also a bit devastating: had I sold a half or a third of my position in Cantel Medical I would have been a happier camper right now. I guess I am struggling with “when” and “if” to sell a stock that is doing well. Luxury problem perhaps, but also an important one if I am to manage my finances better. I think some of it comes down to style and what you feel comfortable with, but developing a strategy that YOU STICK TOO seems important! I have had good gains in a stock and told my self to sell a little, only to hold the stock, watch it fall in price, watch it come back in price and not sell again!

I've heard the argument be made for NEVER selling and just letting your winners run and building up a nice portfolio over 20/30 years but I have yet to wrap my mind around that one: wont you need that money at some point, even if that point is retirement? Or is the idea that you develop this portfolio and use it to leverage other financial matters?

These are the foolish bits of grey matter in my head this morning.

That said, I have not sold any CNXS yet!

--beaker
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