Apple Inc. (AAPL): You Have To Protect Your Gains

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On March 16, 2012, the Dow Jones Industrial Average was up 7.5% and running higher like a scalded chimp. Less than three months later the Dow had given back every point of the gains and then some.

In the third week of September “the most important stock in the world” hit all-time highs just over $700 a share. Since then Apple Inc. (NASDAQ:AAPL) has plunged some 40%, leaving true believers in the house of pain. Those who bought and held the Dow and Apple exactly one year ago today are up 11% and down 21%, respectively.

The question is how to tell the difference between an opportunity to buy and a last, best chance to sell. The difference between success and failure in investing is almost entirely about managing your money effectively and not giving away your gains.

The Capitalist Pig himself Jonathan Hoenig¬†agrees. “Worry about your losers, the winners take care of themselves,” he explains in the attached video. “The real difficulty is so often not necessarily selling the winners, but doing your best to stick with them.” He’s echoing one of the mantras of portfolio management on Wall Street: If you sell your winners and buy dips, you end up with a portfolio with nothing but garbage.

See the full Breakout video below:

Related ETF: Technology Select Sector SPDR (NYSEARCA:XLK)

Top 10 Holdings (63.11% of Total Assets)
Company Symbol % Assets
Apple Inc. AAPL 14.31
International Business Machines IBM 7.35
Google Inc. GOOG 7.35
Microsoft Corporation MSFT 7.26
AT&T Inc. T 7.03
Verizon Communications Inc. Com VZ 4.60
Oracle Corporation ORCL 4.46
QUALCOMM Incorporated QCOM 3.88
Cisco Systems, Inc. CSCO 3.82
Intel Corporation INTC 3.05

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