When To Sell Apple? (IMO, not for some time)

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    Posted: 31 January 2012 04:23 AM #16

    Mace - 31 January 2012 08:15 AM

    Luckychoices story

    When to sell a growth stock such as AAPL?

    Oh wow.  I don’t remember if I read that story all the way through.

    Let’s just put it this way, in a non-advice way:  If I had a buncha shares, I wouldn’t even bother trading.  Now would not be the time to get out of my comfort zone if I’d already made the right moves like that.  Even things like experimenting with a small fraction of the account.  Don’t be like me from the past - know your learning curve, “play within yourself” and really, just be happy with whatcha got if you’re fortunate enough to…well…have enough.

    I happen to believe, as Unofficial Metamodding AFB Forum Overlord (In My Own Mind)?, that this board does not dispense advice of any kind, and that something as intensely personal as investing demands 100% personal accountability (well, I’m not the only one here who believes that, Big AFB Mod on Campus DawnTreader (Robert) thinks so too).  That said, there’s a wide range of non-advice you can read on this board.  Including from another big winner, Mr. Mace himself.

    [ Edited: 31 January 2012 04:28 AM by Mav ]

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  • Posted: 31 January 2012 01:28 PM #17

    I have always believed in buy and hold.  Bought at $26 before the last split.  Wish I would have bought more.

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    KnightATC

         
  • Posted: 31 January 2012 03:28 PM #18

    knightATC - 31 January 2012 05:28 PM

    I have always believed in buy and hold.  Bought at $26 before the last split.  Wish I would have bought more.

    knightATC,
    Congrats for buying at $26/share. Many of us regret not loading up back then. But AAPL is still worth buying, especially for “buy and hold” people like us. I bought 7 shares at $419 with some 25th Anniversary money in mid-September(added to my “Car Fund” account) and then watched the stock drop to $363 by November 25th. While congratulating myself on my always-excellent market timing and further proving to myself that I should avoid trading like the plague, I finally snapped out of it long enough to buy 100 shares at $380 during mid-December, figuring that as we approached earnings, we’d only be going up. Not always true, but in this case it worked out.
    Now my 7 shares, after being down $56/share, are up 7.9% and the 100 shares from mid-December are up 19.2%. Where else can you get that kind of return on your money in such a short time?

    Now granted, that gain may not hold short term, but I did point out this is “buy and hold”.

         
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    Posted: 01 February 2012 12:08 AM #19

    Buying and holding Apple is the good thing to do. Works for me. I’ve had to dip into it now and then to fund something at home, but even a few shares (like I have) have done me well over the years. My last buy was in mid 2010 when it was about $290/share. Feeing pretty good.

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    pbg

         
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    Posted: 01 February 2012 12:11 AM #20

    I don’t have the guts to put a substantial portion of my 401K into AAPL because I’m 65. If I was 45, I’d be buying and holding much bigger chunks, and not selling unless it slid by some substantial percentage.

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  • Posted: 01 February 2012 02:28 AM #21

    Paul Goodwin - 01 February 2012 04:11 AM

    I don’t have the guts to put a substantial portion of my 401K into AAPL because I’m 65. If I was 45, I’d be buying and holding much bigger chunks, and not selling unless it slid by some substantial percentage.

    Hi Paul,
    I understand your concern. I was 63 years old or so when I found out the company my wife and I worked for allowed employees over 50 to put 75% of their 401K accounts into self-managed accounts(SMA). I know I wasn’t any younger than that because my wife qualified as well_so she must have been over 50.  Anyway, I immediately opened a SMA, transferred 75% of my 401K into it and bought Apple stock. I admit that I had a little trouble convincing my wife to use all 75% of her SMA for only Apple stock. But this was because she’d always read to not “put all your eggs into one basket” and both of our IRAs as well as our joint account held only Apple. Within a couple of weeks though, she bought Apple with the total amount in her SMA.  I should explain that the reason I was so anxious to fund my SMA and buy Apple was because the mutual fund choices that we had in our 401Ks had been hugely disappointing. Year after year I didn’t feel I was earning enough for retirement even though we maxed out our 401K contributions. 
    So after consistently promising increases in our SMA accounts, and a terrific year in 2007 when Apple more than doubled, the economy slumped badly and Apple dropped to $80/share. However, I still felt confidant enough to retire in mid-May of 2008, six months short of 66.
    As a direct result of our SMAs, my wife was also able to retire at the end of January 2011 when she turned 55. We both realize that without Apple in our SMAs, I would have had to work longer and she’d be working until at least 60 years of age.
    We did have a big advantage in that both of us were able to use the SMAs to our advantage and we both were able to retire with a pension. New employees at our old company do not qualify for a pension program.
    My point to you though, Paul, is that it may even more important for someone our age to take full advantage of a relatively safe opportunity to increase our retirement funds.  As I mention elsewhere, we’ve even taken to keeping only what’s necessary for monthly bills and emergencies in our bank and moving the rest over to Apple stock. It’s really worked well and you should at least consider doing it on a small scale until you feel more confident to make a bigger commitment.
    Good luck!

         
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    Posted: 01 February 2012 10:52 AM #22

    Lucky choices-you did well. I lost about 1/3 of my 401K in the ‘08 bust. I had it all in my company stock -GE.  For the first 20 years of my career under Jack Welsh the stock doubled every 10 years. But after he retired, the latest regime there just hasn’t been able to get the stock to move. For the last 10 years of my career, I kept it in stock because the company mutual funds weren’t really performing (like yours weren’t) so I left it the stock figuring it had to start doing something some day. It never did, and the market crash dragged it down. I got bit “all the eggs in one basket” law thinking that eventaully it would turn around and just held on too long. I should have had a criteria that said if it didn’t grow x-amount in y-months, roll it over into something else. If you do that with your Apple stock you should be fine.

    When I retired, I moved it all to a good performing mutual fund company with plans tailored for whatever age you are. It’s done well considering how bad the stock market was the last half of last year. It’s a wide range of funds and fund managers under one account title. Basically it makes money when the Dow goes up and loses when it goes down. Over the 20 months or so that I’ve been retired, it’s gone up an average of about 1% per month including the dividends.

    So it would be tough for me to go back to all the eggs in one basket scenario. Apple’s a hell of a basket right now though. Just set your criteria for when to make a move. Don’t you just love gambling with your life blood ?  Drives me nuts.

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    Posted: 01 February 2012 12:55 PM #23

    Paul Goodwin - 01 February 2012 02:52 PM

    ... So it would be tough for me to go back to all the eggs in one basket scenario. Apple’s a hell of a basket right now though. Just set your criteria for when to make a move. Don’t you just love gambling with your life blood ?  Drives me nuts.

    Investing 100% in AAPL is not gamble because of its strong fundamentals and low probability of going into a multi-year or permanent decline.  Stocks are risky and investing in them is a gamble when it has high probability of a multi-year or permanent decline such as RIMM and most tech stocks in 2000.

    Btw, alternative to buying dividend stock is to buy a growth stock e.g. AAPL :apple: and sell a little annually to fund lifestyle.  Since 2002, AAPL appreciates at 60%+ annually on average, last year is 25+%.  Theoretically, you can sell 60% of AAPL annually yet the original investment remains the same much like dividend stocks.

    My short story:  Retired in 2002, age 44, staying in a 1200 sqft condo with a housing loan, stock portfolio 99% AAPL 1% index fund.  Now, age 54, staying in a fully paid 1700 single family house + renting out a 2000 single family house,  stock portfolio 95% AAPL 5% index fund/trading money.  Sold AAPL annually to fund lifestyle.  Would be selling more AAPL this year, considering buying a rental property in Austin grin, think is a good choice?

    Just for interest, a line of guys over 60 years old:
    Paul Goodwin
    Luckychoices
    Gregg Thurman
    Greyfox
    TanToday
    capablanca?
    Howard
    DawnTreader?
    Elmar?
    Please pardon if I forgot some1 else.  ? means not sure.

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    Posted: 01 February 2012 01:17 PM #24

    Mace - 01 February 2012 04:55 PM

    Just for interest, a line of guys over 60 years old:
    ...
    Elmar?
    Please pardon if I forgot some1 else.  ? means not sure.

    Not yet, but approaching fast - born in 1954.
    Not yet retired, just a reduced work load (4 days per week). I do still love my work, therefore not yet any plans for a complete retirement.

         
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    Posted: 01 February 2012 02:38 PM #25

    Oh.  Oh my.

    You think Robert’s over 60? LOL

    Well only he can answer that.

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    Thanks, Steve.

         
  • Posted: 01 February 2012 02:47 PM #26

    Just for interest, a line of guys over 60 years old:
    Paul Goodwin
    Luckychoices
    Gregg Thurman
    Greyfox
    TanToday
    capablanca?
    Howard
    DawnTreader?
    Please pardon if I forgot some1 else.? ? means not sure.

    50 - 60 group
    Elmar
    Mace
    Alice

    Edit:  just for fun

    [ Edited: 01 February 2012 02:49 PM by alice ]      
  • Posted: 01 February 2012 04:57 PM #27

    Paul Goodwin - 01 February 2012 02:52 PM

    Lucky choices-you did well. I lost about 1/3 of my 401K in the ‘08 bust. I had it all in my company stock -GE.  For the first 20 years of my career under Jack Welsh the stock doubled every 10 years. But after he retired, the latest regime there just hasn’t been able to get the stock to move. For the last 10 years of my career, I kept it in stock because the company mutual funds weren’t really performing (like yours weren’t) so I left it the stock figuring it had to start doing something some day. It never did, and the market crash dragged it down. I got bit “all the eggs in one basket” law thinking that eventaully it would turn around and just held on too long. I should have had a criteria that said if it didn’t grow x-amount in y-months, roll it over into something else. If you do that with your Apple stock you should be fine.

    When I retired, I moved it all to a good performing mutual fund company with plans tailored for whatever age you are. It’s done well considering how bad the stock market was the last half of last year. It’s a wide range of funds and fund managers under one account title. Basically it makes money when the Dow goes up and loses when it goes down. Over the 20 months or so that I’ve been retired, it’s gone up an average of about 1% per month including the dividends.

    So it would be tough for me to go back to all the eggs in one basket scenario. Apple’s a hell of a basket right now though. Just set your criteria for when to make a move. Don’t you just love gambling with your life blood ?  Drives me nuts.

    Paul, that’s awful. I can’t imagine the pain of losing that much of my retirement fund after 60(or anytime, really). The closest I came was also 2008 when Apple went down to $80/share. The difference is that, even though I was sweating it, I was relatively confident that when the economy recovered, Apple would too. I must admit that I thought it may take years to get back to $200 and was relieved that it didn’t. Even given the harrowing experience you had, consider that the 100 shares I bought at $380 in mid-December of 2011 are already up almost 20% in a month and a half. Although you’ve given a very clear understanding of why you’re reluctant to risk your retirement funds, I’d still recommend that you CONSIDER buying some Apple on any pullback. Glad your mutual funds are doing well and hope all your investments continue to give you good returns.

         
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    Posted: 01 February 2012 05:11 PM #28

    It’s an interesting non-advice non-recommendation to make. wink

    One interesting side effect that some AAPL shareholders experience is that AAPL-related investments and trades can _become_ your core asset over time.  All a matter of perspective.

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Posted: 01 February 2012 05:18 PM #29

    Mace - 01 February 2012 04:55 PM
    Paul Goodwin - 01 February 2012 02:52 PM

    ... So it would be tough for me to go back to all the eggs in one basket scenario. Apple’s a hell of a basket right now though. Just set your criteria for when to make a move. Don’t you just love gambling with your life blood ?  Drives me nuts.

    Investing 100% in AAPL is not gamble because of its strong fundamentals and low probability of going into a multi-year or permanent decline.  Stocks are risky and investing in them is a gamble when it has high probability of a multi-year or permanent decline such as RIMM and most tech stocks in 2000.

    Btw, alternative to buying dividend stock is to buy a growth stock e.g. AAPL :apple: and sell a little annually to fund lifestyle.  Since 2002, AAPL appreciates at 60%+ annually on average, last year is 25+%.  Theoretically, you can sell 60% of AAPL annually yet the original investment remains the same much like dividend stocks.

    My short story:  Retired in 2002, age 44, staying in a 1200 sqft condo with a housing loan, stock portfolio 99% AAPL 1% index fund.  Now, age 54, staying in a fully paid 1700 single family house + renting out a 2000 single family house,  stock portfolio 95% AAPL 5% index fund/trading money.  Sold AAPL annually to fund lifestyle.  Would be selling more AAPL this year, considering buying a rental property in Austin grin, think is a good choice?

    Just for interest, a line of guys over 60 years old:
    Paul Goodwin
    Luckychoices
    Gregg Thurman
    Greyfox
    TanToday
    capablanca?
    Howard
    DawnTreader?
    Elmar?
    Please pardon if I forgot some1 else.  ? means not sure.

    Hi Mace, You won’t be at all surprised that I agree with everything you said in the first two paragraphs. And I appreciate you concisely detailing why many of us don’t consider Apple much of a risk. It’s that third paragraph that brings me up short. I knew you were heavily invested in Apple but can’t imagine having the nerve to retire at 44. Good for you. Retired 10 years and not even 55 years old? Despicable! I’ve been loving retirement since I was 65_can’t imagine being retired at 44.
    Thanks for including the list of “guys over 60”. I’ve often wondered about the age range of the members of this board and the analytical side of me would love to see a simple, “no name” graph of the the age “populations”. Wouldn’t help with our investments but would be interesting.

         
  • Posted: 01 February 2012 05:24 PM #30

    Mav - 01 February 2012 09:11 PM

    It’s an interesting non-advice non-recommendation to make. wink

    One interesting side effect that some AAPL shareholders experience is that AAPL-related investments and trades can _become_ your core asset over time.  All a matter of perspective.


    Oops, sorry, Mav. Didn’t mean for that to sound like advice or any kind of a recommendation.
    Of course, I would NEVER do that.