The Tom Dupree Show  |  Podcast Show Notes

Buying a Stock Is Easy. Knowing When to Sell Is Everything.

The Tom Dupree Show  |  Dupree Financial Group  |  dupreefinancial.com  |  859-233-0400

---

Episode Description

Every investor knows how to buy a stock. But the moment that determines real wealth — or real loss — is the moment you decide to sell. In this episode of The Tom Dupree Show, Tom Dupree, Lead Advisor Mike Johnson, and in-house analyst James Dupree lay out the sell discipline that has guided Dupree Financial Group’s portfolios for decades, including what triggers a trim, what triggers a full exit, and why waiting for someone else to tell you to sell is one of the costliest mistakes in investing.

The conversation covers the full range of situations investors face: growth stocks valued on revenue and margin guidance, dividend payers evaluated on current yield, bonds that raised red flags in a management meeting, and legacy holdings kept alive by emotional attachment rather than logic. The team also addresses taxes, risk profile management, dry powder strategy, and the very human pull of FOMO that causes investors to ride winners too long — and losers even longer.

“Buying a stock is easy. Selling a stock — regardless of whether it’s up or down — is a lot harder to do.”

---

Topics Covered

• ●  Why sell discipline is the foundation of a sound investment process — not an afterthought
• ●  Valuing growth stocks on revenue guidance and gross margin targets rather than earnings alone
• ●  How current yield signals when a dividend stock has priced in too much optimism
• ●  The role of FOMO and emotional attachment in holding positions too long
• ●  Real examples: Freddie Mac, WorldCom, Kraft Heinz, and a local company that went up 20x and back to zero
• ●  Trimming vs. full exits: how partial sales create dry powder for new opportunities
• ●  Tax-smart selling: harvesting losses, the 30-day wash sale rule, and gifting low-basis shares to charity
• ●  Risk profile management: why one position becoming overweight is itself a sell signal
• ●  Why Intel’s 26-year performance history is a cautionary tale about holding without a thesis
• ●  The danger of relying on a single analyst’s buy list — and getting no sell guidance when markets turn

---

Key Takeaways

• ●  Have a sell target before you buy. When you purchase a stock, establish the price or valuation level at which you would be satisfied selling. If the stock blows past that target, revisit the thesis — don’t just let momentum make the decision for you.
• ●  Valuation drives both buying and selling. A great company at the wrong price is still the wrong investment. Conversely, a mediocre company can become a strong buy when it gets cheap enough. Regularly re-evaluate what you own against current valuations, not just original purchase logic.
• ●  Current yield is a sell signal for income stocks. When a dividend-paying stock rises sharply, its yield compresses. If a stock yielded 6.5% when purchased and now yields 3.4% solely because the price doubled, the market is pricing in a level of optimism worth locking in. Consider trimming.
• ●  Trimming creates options. Most sell decisions don’t have to be all-or-nothing. Taking partial profits — and parking proceeds in money market as dry powder — gives you the flexibility to redeploy into new opportunities when they appear without being fully out of a strong holding.
• ●  Watch your risk profile, not just your returns. If one position grows to become the largest holding in the portfolio due to price appreciation alone, that concentration is a risk even if the company is excellent. Rebalancing is not a sign of doubt — it’s disciplined portfolio management.
• ●  Don’t let outdated advice run your portfolio. Tom shared the story of a widow who refused to sell two stocks because her late husband said never to — leaving her with a 2.1% yield when a redeployment could have generated 7%. Circumstances change. Investment advice should too.
• ●  Emotions are the enemy of good sell decisions. FOMO causes investors to hold too long on the way up. Denial causes them to hold too long on the way down. An investment committee, a written thesis, and objective valuation metrics help counteract the emotional pull that derails individual investors.
• ●  Taxes are part of the sell equation. In taxable accounts, realized gains have a cost. Pairing gains with losses (tax-loss harvesting), utilizing the 30-day wash sale rule carefully, and gifting low-basis shares to charity are all legitimate tools to make selling more tax-efficient.

---

About The Tom Dupree Show

The Tom Dupree Show is hosted by Tom Dupree, founder of Dupree Financial Group and a 47-year veteran of the investment business. Each episode covers the financial topics that matter most to retirees and those approaching retirement — in plain English, without the Wall Street spin.

Dupree Financial Group is a fee-only, fiduciary Registered Investment Advisory firm based in Lexington, Kentucky. The firm manages separately managed accounts focused on income-generating, dividend-paying portfolios — no products sold, no commissions, no conflicts of interest.

Past episodes are available at dupreefinancial.com under the Radio tab.

---

---

Dupree Financial Group is a Registered Investment Advisor (RIA) registered with the Securities and Exchange Commission. Registration does not imply a certain level of skill or training. The information presented on this program is for educational purposes only and does not constitute investment advice, a solicitation, or a recommendation to buy or sell any security. Investing involves risk, including the potential loss of principal. Past performance is not indicative of future results. Please consult with a qualified financial advisor before making any investment decisions.