This question is the ultimate question which nobody have a clear and correct answer to. Because there aren’t any guide or 100 % correct answer to when you should sell stocks you bought at some point.
There is always the risk that after you sell stocks they might go up higher or dive down.
When you buy stocks you need to be prepared to not touch them for a long period of time. Because no one knows when they will go down, just know that no one can predict the future of the stock market.
There is also a stock market volatility which you need to keep in mind when you are investing. Stock market volatility is a statistical measure of the dispersion of returns for a given security or market index. You could be consider selling your stocks when you need cash and they’ve risen in value, but by doing so means you will be paying the capital gains taxes on the sale. This will lead you to miss out on the future gains which will happen over a specific time.
The question would be easier to answer when it was asked differently in the way of “When not to sell stocks”. Because then the answer would have been straight forward and simple. The answer to that question would be not sell when the market is falling.
The market is falling will probably give must of you the urge to sell your stocks to prevent further losses, but thats the wrong move. Because when you sell your stocks it will create a deeper fall to the market. And thats not the way to go while investing.
The strategy which you should follow is to wait out the the volatility and aim for long-term gains with the understanding that the market will bounce back over time.
To give a shot on that question I would say that to just use the investing tolls which your online brokerage provides you with and follow your gut feelings. Because investing is kind of personal and no one has the guide and fully correct answers to every question and every situation which will happen.
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