Two stocks I dumped last week…

I just sold two stocks from my portfolio.

Why?

The answer is simple, it was TIME TO SELL!

And if you’re not doing the same thing right now, you’re not as bright as I thought.

Here’s the details…

I had a stock with a loss. No big deal, it happens. We’re not perfect, and we can't win on every trade.

Now, what’s interesting is, the timing on this sale should be crystal clear.

This is the time of year for Tax Lost Harvesting.

You have until the end of the year to “harvest” tax losses from your portfolio.

This is the time of year you want to sell your losing stocks. It generates an investment loss, you can deduct from your normal taxes.

Now I’m not a tax expert, but I believe you can deduct the first $3,000 of losses against your regular income.

I don’t know about you, but I don’t like paying the government my hard earned money. So, I’m going to find every deduction possible!

So, I sold my losing stock.

It was a utility stock by the way… I wasn’t looking for tech-like returns, but even this stock was struggling. So I cut my losses.

But here’s the kicker… My losses were more than $3K.

It meant part of my tax loss might go unused.

To counteract this, I sold a second stock!

READ THIS CAREFULLY…

What I want you to understand is how I picked the second stock to sell.

Most idiot advisors will tell you to sell some of your best performing stocks… They say sell the biggest winner to balance your portfolio. Lock in your gains.

They might say - “You never go broke taking a profit.”

Sage advice if more than 30% of your net worth is in one winning stock (and that’s the one you’re going to sell)…

But, I have a well diversified portfolio.

I’m NOT going to sell my best performer.

Remember the old adage - “Starve the ponies, feed the stallions.”

As a matter of fact, I’m considering buying more of my best stock!

How’d I pick the second stock to sell?

I looked for a stock that’s just doing OK. A stock that had OK returns. Maybe a stock that had a profit. But, a stock I didn’t like as much.

I found a stock where my opinion on the future of the company changed.

What I found was a middling dividend payer. The stock had grown only 10% over the last 3 years… and the dividend while growing, wasn’t very exciting.

Remember this stock was up… I had profits in it.

It’s just the profits were anemic.

That’s the type of stock you want to sell.

DON’T sell your best performing stocks… Sell the below average winners and redeploy that capital into something more interesting!

Listen, you only have about 15 trading days left in the year to make these moves.

So, please, take action today.

Look at your portfolio, and dump the losers… and go ahead and sell a few of the mediocre winners too.

Then in the New Year, we’ll look for other exciting investment opportunities. I’ve got a few ideas to share! More on those in the next few weeks.