The board market continues to consolidate while many of the stocks that have made monster moves are giving back big chunks. Even with the current pressure, look at the monster returns over the past year.

For many investors the plan is to buy the dip.

Why not? It has been an amazing blueprint for making more money. More than anyone could have dreamed of making it in any legal, maybe even illegal, transaction.

There will be a time when the dip isn’t temporary, but the start of something long, ugly, and painful.

You only know after that fact. 

Portfolio Management

When to close high beta winners? Nothing hurts more in the stock market than watching a big winner become a loser. The challenge with stocks that can rally three or four percent in a session is that they can fall just as fast, or faster.

We employ the same decision-making process to close the ideas that we apply to add to them. There is a different kind of risk factored in when they start taking the highflyers to the woodshed. Remember, ringing the register is the aim of the game, so never get hung up on a stock moving higher after you’ve closed it out.

Right now, only one sector is down over the year. It’s not time to panic, just time to have patience and raise a little cash.