By “old names” I mean stocks that were once discussed and owned by many on this board, but then mostly sold in favor of other, potentially more lucrative, companies.
Some examples of those companies hitting ATHs in the past couple of weeks:
ZScaler (ZS): Just hit an ATH $96.67 TODAY
MongoDB (MDB): Just hit an ATH of $227.82 TODAY
Nvidia (NVDA): Hit an ATH of $367.27
Wix (WIX): Hit an ATH of $219.11
Shopify (SHOP): Hit an ATH of $844.00
Ubiquiti (UI): Hit an ATH of $199.91
Square (SQ): Hit an ATH of $87.25
Twilio (TWLO): Hit an ATH of $209.94
The Trade Desk (TTD): Hit an ATH of $327.35
To be fair, there are plenty of “old names” that continued to languish, or worse, after they were mostly abandoned: Nutanix (NTNX), Pure Storage (PTSG), Arista (ANET), Talend (TLND), etc. And, it’s worth noting that even some of the companies hitting ATHs recently have not been worth staying invested in (NVDA, for instance) due to the combination of them taking too long to get to that ATH (opportunity cost) and/or that ATH not being that much higher than the prices they were sold at.
Saul’s right that it doesn’t matter to your portfolio what the stocks you sold did after you sold them, that what’s important is what the stocks you’re holding are doing. BUT, I do think there may be learnings we can gather. After all, we originally invested in these companies because they had good products or services, a good business model, and good management. Then the story changed. The question in my mind is whether we can learn how to identify a hiccup versus a true change in the long term trend? Is there a way we could have known that Zscaler wasn’t going to be another Nutanix?
Or maybe it was right to get out at that time, but they should have remained on our radar to catch their rejuvenation. Is that something that, in hindsight, was possible and that we can apply in the future?
And while tax consequences are rightly off-topic for this board, I do think that one’s strategy of what to sell and when have to take in account consideration of whether you’re trading in a tax-deferred account like a 401K or in an account that you have to settle up with the IRS each year. Taking a 15% to 45% haircut on your profits from a sale means your new investment has to do that much better just to break even.
I sure don’t have the answers, but it seems to me that we could have usefule discussion of how high-growth stocks don’t always (often?) experience consistent high growth, and how to identify whether month-to-month or quarter-to-quarter changes are merely blips or true indications of a change in the long term trend.