[AznHisoka]

I think this is easier said than done.

You most likely need to wait until it's close to 3 X the value you bought it because you'll need to pay short-term taxes after you sell it.

And once that happens, why sell half of it, vs all of it? 3 times the current value is a LOT of money and that usually takes at least 8-10 years in the equity market. Now that it happens, you're cashing out just to recoup your costs? Cash out everything, or cash out nothing and let it all ride until it's an even larger amount.

[lysp]

It's a standard share trade strategy.

The net cost is 0 - cash in = cash out. And taxation is zero because your profit is (at the time) 0.

It also means you can do something else with your original investment.

If it goes up 100x - cash out whenever. If it goes down to 0 - you have lost nothing at all apart from some time.

[AznHisoka]

why is your profit 0?

you buy 2 at $5k it goes up to 10k and sell 1.

profit is current value - cost basis

10k - 5k = 5k profit that will be taxed

[bocklund]

> why is your profit 0?

Because the 5k in the market is not a realized gain

[graedus]

> I think this is easier said than done.

Agreed

> And once that happens, why sell half of it, vs all of it? 3 times the current value is a LOT of money and that usually takes at least 8-10 years in the equity market. Now that it happens, you're cashing out just to recoup your costs? Cash out everything, or cash out nothing and let it all ride until it's an even larger amount.

I agree "just recouping your costs" is not really exciting by itself. The idea is that you think it might go much higher, but - crucially - you're not sure. It's just about reducing your exposure to risk at the cost of some upside potential. It all depends on your risk appetite.