Three Motley Fool contributors talk it out.
In this podcast, Motley Fool contributors Rick Munarriz, Lou Whiteman, and Jason Hall discuss selling decisions they wish they could take back. They also look at some stocks that could thrive in the new normal. There’s also a sporty look at some of this year’s biggest winners and losers.
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Rick Munarriz: Don’t go on a path to sell destruction. Motley Fool Money starts. I’m Rick Munarriz, and today I’m joined by two of my favorite voices in Fooldom, Jason Hall and joining us for Hidden Gems, Lou Whiteman. We’re going to take a look at some stocks that we believe will head higher in the coming months. We’re also going to play a new game called Double Trouble. But first, investors spend a long time treating their stocks as soul mates. Sometimes they should be treated as cell mates. We spend a lot of time discussing meat cutes when it comes to stock ideas. Today, I want to talk about breakups. More to the point, what’s the decision to sell that you regret the most? Mine is easy, but I want to start with you, Lou. Like trying to figure out what to do with a blank spreadsheet square, let’s talk about your worst sell decision.
Lou Whiteman: I’m a terrible person to ask this because it’s so boring, Rick. Not because I’m brilliant, not because I don’t have terrible mistakes, but rather I don’t tend to dabble in the early stage companies that get these great explosions later higher. I assure you, if I would have owned Amazon or if I would have owned Tesla back in the day, I would have sold them, and I would have regretted them now. But I do have a lot of regrets, and I do think there’s a lesson there because I share a theme. Two really good companies I sold years ago. One, Axos Financial, the online bank. I think it’s up like 200% since then. I really regret that. The other is Loews, not the home improvement company, but the financial hotel conglomerate. It’s almost a double since then. The similarities, the reason I regret them, these aren’t the oh, my gosh, I’d be a trillionaire now, but I’ll be honest, I sold them without any good reason. I had no magic process. I had no guiding principle. I basically got bored with them, and I saw something shinier and flashier, and that is the worst reason to sell. Not dramatic declines. This just eats at me because this is the danger of acting on the whim instead of with real intent. Every time I look at those, I get a little sad inside.
Rick Munarriz: A lot of real world relationships end for the same reason, Lou. Jason, what’s on your plate?
Jason Hall: I could go with one that Lou mentioned. I could go with Tesla. I bought I believe in around 2016. I sold a couple of years later for a decent little profit. Stocks up 2,000% since I held. Rule Breaker investors that that followed the Rule Breakers portfolio have enjoyed 16,000% in wins owning Tesla. Now, clearly a financial mistake, but not sure that I regret it because I didn’t sell it for concerns about the business as much as just concerns about Elon Musk’s ability and interest in staying focused on Tesla, and concerns about the company’s ability to deliver more than just EVs and maybe batteries. I could also go with selling half of my Nvidia stake about two years ago. Stock is up 446%, and it’s never been below the price that I sold. I don’t really regret that though because I sold it at this point in my financial life where I’m thinking about position sizing, and it had become such an out-sized position in my portfolio. I’m still OK with that decision even though maybe I should have let that problem become a much bigger problem. But the one that I really regret, Rick, I even wrote about it on fool.com in August of 2013, and that was selling Microsoft, and it was right as Steve Ballmer was leaving and set to be replaced by Satya Nadella. I sold entirely because I just ran out of patience at really the absolute wrong time to have been running out of patience with Microsoft, and it’s been an 18-bagger since I wrote that article and since I sold my shares.
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