When to sell? There is no hard and fast rule, except one: Sell long positions immediately if the reasons for purchase prove themselves to be wrong by declining in price.

Good "buyers", that is to say, those who know how to recognize real bargains, are often weak "sellers" because they tend to sell too early or hold on too long.

They either become uncomfortable as soon as their positions reach "normal" valuations (sell too early) or tend to give their positions "the benefit of the doubt" when early signs of weakness begin to show up (hold on too long).

Periods of depression, bad business conditions, and public apathy are naturally followed by periods of overvaluation, good business conditions, and public over exuberance.

At such times as stock prices advance beyond the most optimistic expectations of those who bought very early and very low they begin to feel uncomfortable and unsure of their positions.

Intelligent liquidation is not simply the reverse of intelligent accumulation. Unwinding of long positions is not the same as initiating short positions. Stocks often make unsatisfactory long holdings without being clear-cut short sales.

Never allow a large unrealized gain to turn into a loss. If your commitment is large, scale out of the position in stages on the way up.