Watering the flowers: The art of selling shares

Erik Landgraff

How can you develop a sensible sell discipline which ignores market noise? SKAGEN portfolio manager Erik Landgraff explains the rules he follows when deciding whether to hold or fold.

The selling of stocks often gets less attention than it deserves. Rather than following widespread - but often unsuitable - strategies, at SKAGEN we choose to focus on company fundamentals and valuation when considering a potential sale. One sales strategy often given a great deal of attention is stop-loss. The idea is that an investor can limit the loss of an investment to a predefined limit. In other words a stock is automatically sold when the price reaches a given point. This strategy is not only unprofitable, it is also illogical. If a company is priced lower on the stock exchang...