Does it appear your portfolio has taken a beating so far in 2008? Ron DeLegge for ETFGuide says it is possible you have overdosed on low-octane, under performing stocks.
In the past year, there have been some stocks on a real losing streak. If you’re still sitting on those stocks, DeLegge suggests giving ETFs a look instead to minimize and spread out the damage.
While individual companies come and go all the time, most sectors remain alive and well. Instead of hanging on to those underperformers, get rid of them and replace them with a corresponding sector ETF if you still want to maintain that exposure.
It’s a good reminder, too, to keep your emotions out of the game when it comes to investing. If your holdings aren’t doing what they should, it’s time to let them go and find something that works for you. Perhaps even establish an exit strategy you can stick to in order to keep your portfolio clean year-round.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.