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  • When to sell?

    I have a taxable brokerage account and I bought SQ about 4 years ago and it has absolutely taken off over the past two years to the point I have no idea of its true value. What is a good strategy to lock-in gains, but also not wanting to liquidate the entire stock due to the large capital gains tax hit?
    Last edited by DCAflyer; 02-16-2021, 10:03 AM.

  • #2
    donate it

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    • #3
      Options:
      1. Die
      2. Lie
      3. Donate
      4. Quit working, sell, and have 0% cap gains rate

      Or:
      1. Sell and diversify immediately
      2. Sell LT lots, turn off div reinvesting (if applicable), sell more LT lots as they reach the 1 year mark

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      • #4
        Selling and paying taxes is always preferable to riding back down and not paying taxes.
        P/E ratio 591.88
        It can always keep going up , but it has a lot of downside risk.

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        • #5
          Try to balance the sale with a tax loss harvest if one occurs. Also a DAF contribution. Otherwise sell part of it and pay the gain.

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          • #6
            In my current position I would donate it but if I were really, really old (like over 40 old), I'd probably just hang on to it since I'd be living on borrowed time anyway.

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            • #7
              Originally posted by CordMcNally View Post
              but if I were really, really old (like over 40 old)
              WTH?!?
              I would call you a whippersnapper but that would only cement my oldness.
              Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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              • #8
                I don't think appreciation alone is a reason to sell, or avoiding LTCG tax is a reason to keep it.
                If it's risen to the point where it makes your portfolio too risky, sell it. If it's a part of a well balanced portfolio, keep it. But its current price should have no bearing on your decision*.

                *Coming from a guy who never sells anything, so keep that in mind.

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                • #9
                  Originally posted by molar roller View Post
                  I don't think appreciation alone is a reason to sell, or avoiding LTCG tax is a reason to keep it.
                  If it's risen to the point where it makes your portfolio too risky, sell it. If it's a part of a well balanced portfolio, keep it. But its current price should have no bearing on your decision*.

                  *Coming from a guy who never sells anything, so keep that in mind.
                  Couldn’t agree more. And don’t contribute it to a DAF unless charity is one of your GOALS and the donation fits within the parameters you have already set (which includes good tax planning).

                  Never give away assets, choose to earn less, or spend money just to save taxes.
                  Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                  • #10
                    Isn't the whole point of buying it to make money, sell it at some point and then pay taxes on it? A good strategy to lock in your gains? Sell it. Would you rather it tanked in value and you didn't have to pay any taxes? Or sell enough to cover your cost basis + taxes on the gain and let it roll

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                    • #11
                      Sell.

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                      • #12
                        When to sell? Immediately.

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                        • #13
                          answer depends on how much you have, there's a difference if it's 20K (let it ride), or 2 million (take some off table)

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                          • #14
                            Short and most likely unhelpful answer = it depends. Do you need the cash? Would you be upset if SQ had a 50% drawdown?

                            It depends on your risk tolerance and situation. I have SQ from the $60s and have sold some on the way up. Sure I missed more upside by not holding my full position but I've realized some gains and it allows me to sleep better at night...and that fits my desired risk profile. I still have some left over and will continue to ride it out but, for me personally, it feels pretty good to lock some in along the way.

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                            • #15
                              Syndicated real estate in an opportunity zone (OZ) fund?

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