Author Topic: sell disney stock  (Read 3583 times)

Rocket

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sell disney stock
« on: May 09, 2016, 10:35:11 PM »
I purchased a lot of Disney stock over the last 20 years.  It was on autopilot and I forgot about it for years.  I stopped about 5 years ago and have about 210k worth of stock at this point.  New stock is purchased when dividends occur.  Disney did nothing for years but has done really well over the last couple of years.  Its the only single stock I own and its around 10% of my net worth.  My question is what to do with it? Just leave it and hope it doesn't tank or sell and take the capital gains hit and invest it index funds?  Every time I look at my Personal Capital account I think I should sell it.  Most of my other investments are in VTSAX and VTBLX.  Thanks for any suggestions.

MDM

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Re: sell disney stock
« Reply #1 on: May 09, 2016, 11:31:37 PM »
If you think it will do better than the rest of the market, keep it.

If you think it will do worse than the rest of the market, sell it - at least stop reinvesting dividends.  How big a tax hit if you sold it all this year?

Doubleh

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Re: sell disney stock
« Reply #2 on: May 10, 2016, 12:42:30 AM »
What does your IPS say? If you haven't formally written one, think what it would say. Would you invest 10% of your nw in a single stock today? If not then sell it. The fact that all your other investments are in trackers shows you're not aiming to beat the market, so why should this one stock be treated any differently? This article talks about the cognitive biases that make it hard to sell things but why you should anyway:

http://www.mrmoneymustache.com/2015/07/02/if-you-wouldnt-buy-it-you-should-probably-sell-it/

NoStacheOhio

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Re: sell disney stock
« Reply #3 on: May 10, 2016, 07:00:16 AM »
If you wouldn't buy it today, then you probably shouldn't hold it. I would start by turning of dividend reinvestment.

Have you looked into what your cost basis actually is, and how much of the value is capital gains? Is it all in taxable? What's your tax bracket?

You could sell it over time, so the capital gains don't all happen in the same tax year.

Rocket

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Re: sell disney stock
« Reply #4 on: May 10, 2016, 09:31:30 AM »
I wouldn't buy a single stock today, so I guess that answers my question.  I need to figure out the cost basis and subsequent tax hit.  No idea how to do that but will start learning.  Thanks for your replies.

zolotiyeruki

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Re: sell disney stock
« Reply #5 on: May 10, 2016, 09:45:43 AM »
Do you *have* to do it all at once, or could you divest gradually, say over 5 years, to spread out the capital gains and avoid the higher tax brackets?

Rocket

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Re: sell disney stock
« Reply #6 on: May 10, 2016, 11:34:45 AM »
I'm not in a rush to divest and could do it slowly to minimize tax hit.  My tax bracket would change a lot when retiring so maybe thats a good time.  When I hit 52 I started thinking about retiring, and how much money I needed.  Was still thinking 60's at the time.  Those searches eventually found this site and the realization that I had plenty of money to retire now.  Now retiring early is all I think about.  Very strange.

rulesofbio

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Re: sell disney stock
« Reply #7 on: May 10, 2016, 06:20:30 PM »
hey dude there are lots of wdw forums and disney lovers who would be interested :)

Scandium

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Re: sell disney stock
« Reply #8 on: May 11, 2016, 04:15:41 AM »
Do you donate to charity? You could give some of the stock tax free instead of cash

BFGirl

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Re: sell disney stock
« Reply #9 on: May 11, 2016, 09:48:12 AM »
I had 10% of my net worth in IBM at one point.  It made me nervous to have that much in one company.  If I do buy individual stocks, I try to make sure they are no more than 1% of my net worth.  I did buy Disney this year.

obstinate

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Re: sell disney stock
« Reply #10 on: May 11, 2016, 01:41:47 PM »
If you think it will do better than the rest of the market, keep it.

If you think it will do worse than the rest of the market, sell it - at least stop reinvesting dividends.  How big a tax hit if you sold it all this year?

No ...  Sell it either way. Stock picking is best left to professionals, especially when you're talking about a non-trivial fraction of your net worth. If you wouldn't buy it, you should probably sell it.

Old Man Mase

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Re: sell disney stock
« Reply #11 on: May 11, 2016, 02:20:49 PM »
Disney is one of the top 50 or so companies in the world - so it's not a great tragedy if you decide to hold it.  If you are uncomfortable with a 10% weighting, i might just take the dividends and reinvest elsewhere.

thunderball

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Re: sell disney stock
« Reply #12 on: May 11, 2016, 02:36:00 PM »
OP, instead of selling the stock, why not sell covered calls against your position and collect income?

Based on $210K, you have about 2,000 shares.

The JUN 3 weekly, 108 strike pays about $0.14 per share or $280, and after 23 days it'll either expire worthless (93% chance it will, and you keep the $280) or above $108 your stock gets called away (and you still keep the $280).