What Are You Thinking?

Kyle is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

“If you liked that stock so much, why’d you sell it?” There was a time earlier in my trading life when I used to beat myself up over trades “made too soon” or “too late.” I don’t want you to go down that path.

I have stated several times, there are scant few stocks that we can buy and hold until the end of time, only to bequeath them to our loved ones, so they are able to pick out a nice urn for our cremated ashes, rather than whisk our remains into a coffee can (“The Big Lebowski,” “Due Date”). I have also stated that I will not relinquish my small position with Nike (NYSE: NKE), but I think the swoosh is one of those special companies that belongs in that elite group.

Yesterday I closed my position with F5 Networks (NASDAQ: FFIV). I still like it, though. So before I get a barrage of people pelting me with “why’d you sell it?” let me attempt to explain. I think F5 has room to move, I truly do. But I like something else more. This is not a marriage. There is a very small portion of my truly deluded mind that allows me to hold “until death do us part.” So I sold it. I may very well buy it back in small portions in the future, I can’t say right now. And I’m not looking back. No regrets.

Sure, F5 may very well make my move look incredibly foolish. But I like Baidu (NASDAQ: BIDU) more. Sorry. I hope we can still be friends.

The trick to this is to completely, without second-thought, sever your position. And move on. I could have just sold some of it, giving myself smaller exposure, sure. But I want that money, all of it, to go to work for me with Baidu. Not only are these two stocks in the same sector, they have both been knocked around a little. I think Baidu is going to soar. I don’t care if you don’t, I don’t care if Jim Cramer doesn’t, I do. That’s all I need, and that’s all you should need in any piece of stock you put your hard-earned money toward.

As I always state, I am not recommending that you do anything. I want you to be successful, and if you want to play the short side, I wish you the best. You can have the battle. I’ll take the war. Baidu is up over 4% as I type this. I wanted it yesterday (kind of like LSU wanted offense last night), but my position with The Motley Fool doesn’t afford me that opportunity. I respect that, wholeheartedly. I will wait for another setup, I assure you. I still like it at these levels, and I think it has the potential for a 20-50% move.

This line of thinking allows me to clear my slim position with F5 and not look in the rearview mirror, wondering “what might have been.” These are stocks, people. They don’t have feelings. They don’t care about you. If you try and practice that discipline, you will be a much better investor.

Until next time, from the trading table,

Kyle Metivier


Motley Fool blogger Kyle Metivier remains steadfast and faithful in his long Nike position. He does not own F5 Networks or Baidu, but will own the Chinese Internet search company within 1 week.

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