Surgevesting is thrilled to announce a significant milestone: the sale of nearly half of our Honeywell (HON) shares at an impressive $207.20 per share, marking our most substantial profit yet. This decision was the product of careful consideration and adherence to fundamental investment principles—a testament to the importance of discipline in navigating the stock market.
The decision to sell half of our Honeywell shares reflects our strategy to secure profits while maintaining a position to benefit from any potential continued rally in the future. As our largest holding, Honeywell still holds a significant position within our portfolio. Even after the recent sell-off, it is still apart of our “BIG 3” stocks. Retaining the remaining shares allows us to participate in potential future gains while securing a substantial profit from the shares we sold.
In the realm of stock trading, the decision to SELL can be as crucial as the decision to BUY. As we continue to delve into the wisdom shared in Charles Payne's book we are reading, "Unstoppable Prosperity," we recognize the challenge lies in determining the opportune moment to offload shares. As Payne says, investors often fall into the trap of assuming perpetual market growth, neglecting the importance of realizing profits. Remember, you do not have the profits until you sell, it is solely your net-worth and in the books. Payne also calls the stock market “the greatest wealth creation machine known to mankind”.
Our rationale for selling Honeywell shares stemmed from various factors, including our assessment of an overbought market. In our recent article here we discussed the current state of the market and the potential for a looming correction. Anticipating this, we've bolstered our money market funds, preparing to capitalize on market downturns by strategically reinvesting in stocks when opportunities arise.
Moreover, Honeywell's substantial position in our "BIG 3" holdings underscored the importance of diversification. It's a fundamental strategy we value immensely. Diversifying our investments across various stocks shields us from potential adverse impacts of individual stocks, safeguarding our overall portfolio. In line with this, we envision transitioning from a "BIG 3" strategy to a broader like ”BIG 5-7,” ensuring a more evenly distributed investment across a select group of stocks.
Nevertheless, while diversification is crucial, an excessively vast portfolio can dilute potential gains. Striking the right balance between a manageable number of stocks and diversified investments remains key to maximizing returns.
The excitement for learning and growth is palpable at Surgevesting. We recognize that every decision, whether buying, selling, or diversifying, contributes to our journey of continuous education and progress in the dynamic world of investing.
The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
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