It is easy to say that one has to buy low and sell high to make money in the equity markets. However, selling is one of the toughest decisions one can make. Most people err on the wrong side. No wonder many studies have proven that the average retail investor makes lesser returns than the market itself. You can consult a SEBI-registered investment advisor about how to invest in quality stocks and approach direct equity investment in general. Make sure you also take nuanced views on when to exit from equity funds or specific stocks you are holding.
Here are 4 reasons to exit from equity funds that you are holding.
Doesn’t Meet The Investment Philosophy
The stock no longer meets your chosen investment philosophy or one that the fund manager has stated. In our case, we believe in “Roots & Wings,” which stands for strong balance sheets coupled with growing earnings. If a company does not meet these criteria, it is a signal to exit. One may give some benefit of the doubt, but the long rope cannot extend indefinitely.
Continue reading this on the Jama Wealth Insights blog – When to Exit Equity Funds