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Strategies & Market Trends : Value Investing

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Jurgis Bekepuris

Mr.Peabody

To: Jurgis Bekepuris who wrote (56010)	9/7/2015 7:18:57 PM
From: E_K_S	2 Recommendations Read Replies (2) of 78630

Hi Jurgis - I noticed a lot of changes to your portfolio and wondered generally what your basis is for a 'Sell'. Is it because the value proposition is no longer valid and/or something has changed in your original Buy premise and/or switching out of a 'sour' sector to one that is better and/or gave up on the stock in favor of something better and/or the stock price hit a hard stop loss price? Also, what is your average holding period for a stock (and your portfolio turnover rate)? Paul had mentioned that he turns stocks over on average every 3 years (that may have changed since our last discussion). I find that I a generally will begin to peel off a few shares of a position after 3 years (36 months) and if it is in 'fair' value territory. I typically will sell when I am trying to build up my cash reserves and/or have found a better value proposition. I also will SELL part or the entire position to harvest a loss (to offset other capital gains). Losses come in two categories for me: (1) close out the entire position because of a company specific problem and/or I was wrong in my original valuation proposition or (2) sell my high cost shares and look to re-enter that portion of the position in 31 days reducing my avg cost basis and maintaining my portfolio position weighting. I make several buys over several months when establishing a new position so my average cost basis can vary from the current market stock price (sometimes as much as 25%). If I still find the stock attractive (based on my original value proposition), I will usually add shares every 5% lower (3 adds max). For me, there is a lot that goes into making a SELL and I have developed my current strategy after years of portfolio re-balancing and trying to let my winners run and selling my losers when they just do not perform. With my current portfolio management system, my premise is to let my winners run and grow. I only sell if the value proposition has changed significantly. I tend to find I keep some 'value trap' positions too that may/could eventually realize full value (at least BV). It would be interesting to see what others do when looking to sell a position. EKS

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