Editor's Note: Sometimes the worst investment will end up making your >>
This article is compiled by Matthew Frankel/Travis of The Motley Fool
I first bought Tesla in 2011, when I was still teaching in Florida. I happened to experience my friend's Tesla $TSLA Roadster, and based on what I already knew, I came to the conclusion that the Model S behind would "change the rules of the game." So I bought 100 shares of Tesla for about $23 a share. Later, because of the stock split, my position became 500 shares, and the cost was about $4.60 per share.
At the same time I write this, Tesla's current share price is about $1088 per share. If I had bought and done nothing until now, my $2,300 investment would now have become $544,000.
Unfortunately there are no ifs, and I make a lot of mistakes that young investors often make.
Why should I sell my Tesla for $12?
Fast forward to 2013. I had just gotten engaged that year and was preparing for the wedding, so I needed a lot of money. And we still have to buy a house, and we lack a down payment, but I have very little money left. So I thought it was time to use the stock account.
Tesla was the only one of the 3 stocks I had in my hands at the time to make a big profit (the other two being AT&T $TBB and first solar $FSLR). At that time, the Model S had just been named the 2013 Car of the Year by Motor Trend, and soon after the Model S began to be delivered, Tesla's stock price rose rapidly. At that time, my 100 shares were worth about $60 per share, and considering a split should be $12 per share. (That account has been cancelled, the exact number is not remembered.)
By then, the original $2,300 had become $6,000. I thought to myself, "I've already made double the amount of money, and there's absolutely nothing wrong with clearing the bag at this time." ”
So I sold my Tesla $TSLA position and now it seems like I'm making $538,000 less.
Why don't I feel bitter about it?
If I say I never regret selling a Tesla, I'm lying. But after all these years, my perspective on the problem has changed, and I have concluded why that sale was the right one.
First, my wife and I bought our first home in a more expensive place (Key West, Florida). Now we don't live there, but we still have a lot of good memories, and we made a profit when we finally sold it.
Second, and most importantly, the proceeds of that sale helped me reap true happiness in my life. Not only have I spent 8 years of happy married life, but, arguably I've come very close to my ideal life, I have two lovely children and a happy family. I knew very well that it was the 100 shares of Tesla I sold that helped me achieve all this.
In the end, I gained one of the most important experiences of my investing career, and I believe that this experience will eventually make me far more money than I did less on Tesla.
That is:
"Because it's up" is not a reason to sell a stock. If my initial buying logic was correct and now applies, then why should I sell my "winner"?
Since then, this experience has really benefited me a lot.
For example, I bought Square $SQ shortly after the IPO and haven't sold a single share since, even though the profit has reached about 15 times. If it wasn't for selling Tesla to teach me a lesson, I might have made 1 or 2 times and left.
Because of this experience, I have achieved extremely high returns on several stocks. More importantly, as my investment career progresses, this lesson will continue to motivate me to firmly hold the position of the "winner" and stop selling for a small profit.
Of course, I wish I hadn't sold Tesla, but it was that decision to sell that that ultimately accelerated my maturity, and I became a better investor and a more fulfilling life.
So, from another perspective, selling Tesla is arguably the most correct investment decision I've ever made.
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