The Sell Decision With Mutual Funds: Knowing When to Walk Away

The Sell Decision With Mutual Funds: Knowing When To Walk Away Splash image

Many people hop in and out of investments all too frequently. That's due in part to the fact that mutual fund advice and information are so freely available that individuals often are persuaded to switch from their more prosaic funds to those that have been delivering more exciting short-term returns. At the opposite extreme, others take the attitude that, once bought, mutual funds can practically be held for a lifetime. That can be true in some instances, but it's often not—you really must rethink your portfolio periodically.

What are the legitimate reasons for sel

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Discussion

Bruce from Texas posted over 3 years ago:

Diminishing Assets of your fund is seldom mentioned a a reason to sell


Gerry Page from Maine posted about 1 year ago:

If Value drops 10 - 15% I will sell and watch the price, if it goes up to where I sold I'll buy it back and set a downside limit order.


Robert Marriott from Virginia posted about 1 year ago:

I'm a purest in the sense that if a fund says it's a "domestic mid cap value" then it needs to be that. What I have noticed over the last several years is that many well known and respected managers have dipped into other markets to inhance performance. (in my opinion) Third Ave Value has been the biggest offender I have seen to date establishing itself as a premier mid-cap value fund and over a 5 or 6 year period moving to a "world fund" go any place buy anything type of fund.
If one is using an asset allocation model that style drift behavior can reek havoc.

Another offense and reason to consider selling is domestic funds taking on larger and larger percentages of foriegn issues. I have noticed it particularly in the large cap arena. Again if you are allocating to certain specifics, that type of fund behavior throws ones percentages off and will effect returns and risk. (both positively or negatively - you just don't know which one).


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