hedge said:
And what led you to that prognosis
Let's look at this from the 2 angles because I was replying to Agdaddy04 regarding his IRA and this should not be applied to trading accounts because he will not have tax liability.
1) He has no risk of booking huge profits in his IRA. If he was asking about his taxable trading account, then I wouldn't suggest for him to sell AAPL or TTD, even though I can see them falling. They're leaders and funds love them. Yes, they'll probably selloff but trying to sell at highs and buying at lows in a taxable account isn't wise when you're in the best stocks at a much lower price, unless you DGAF about taxes.
2) The market is extended considering the headwinds that is in front of it. I listed those in a previous post above. Even the best of breed stocks will take it on the chin when market sentiment reverses. They will also be the leaders when the markets rally back. His entry price in AAPL is $120 and if he bought TTD in May, when we talked about it, then his cost is probably below $60. That is monster gains in an account that is tax free. He'll be able to buy both back but add even more shares and ride them up again. He's severely limited in the amount he can contribute yearly. How sick would you be if I'm right and AAPL prints $120 and TTD fills the gap at $75 but you've seen your account evaporate. Now compound that with the fact he might position himself to buy almost 2X the shares he originally and ride them back up?
Is it a risk, of course, but it's a calculated risk that looks more in his favor than the alternative.