Would you ever stop trading the stock market?

I had an interesting discussion with a friend recently who told me that he'd sold all his stock investments after having the best trading year of his life. He reasoned that he'd hit the heights of what he could ever have expected viz-a-viz the markets, and that it'd be all down hill after that.

Have any of you ever thought about what would cause you to liquidate everything and stop trading? Some have that decision forced on them, but I wonder if it's ever prudent to have a plan in place if certain positive conditions are met. Thoughts?

 

Obviously the answer depends upon the indvidual's net worth. Buffet or Gates or Trump, what difference does it make? Someone with a net worth of a million or so, a different answer is appropriate. Unless that person has a short live expectancy and no wish to help family/heirs, IMHO it's a silly move to pull out of the markets. Consider if wherever he is living has inflation at some level, that affects the cost of living. At least in the USA, If nothing else one can collect decent dividend income from quality investments, certainly better than a pass book savings account

 

Yeah, I agree with you, baudwalk. Even if you just reinvested a small portion of your profits in long position stocks, you're hardly risking anything over and above what you've already made. Plus, I don't even know how someone could make the decision that they wouldn't be profitable in the markets ever again. It actually mitigates for the opposite conclusion - if you're able to make a good return one year, you're probably just as likely to do so in the future.

And like you say, inflation is a killer. Market investment is a proven way to insulate yourself against its harsher effects.

 

What matters in now how well the market will do now verus then, but what your investment goals and what platforms meet them best. Stocks are always going to be part of the mix for me. If nothing else, I want to keep things diversified.

But in anyone has been doing really well with stocks in the lasy year... well. What the hell have they been investing in? Like most people I am well in the red for the period of the last 12 months. The market has been brutal.

 

I don't think I'd ever stop trading or investing in stocks, at least not in the near future. As what anders said, I wouldn't want my money to go behind the constant inflation we experience. Investing in stocks is a good way to make sure that the money we put aside will grow despite the changes of times and prices we face everyday.

 

For me, stock market is not about only making money. so, I will never stop trading.

 

I suppose a lot will depend on my risk profile, investment timelines etc etc. But in reality, I can't see myself completely moving away from trading the stock market. I won't be an active day trader - that's not me. But I do feel the need to take more control of my financial future so I do intend to remain actively involved.

 

I think your friend is lucky to hit it big time with stocks and he is pretty smart to quit. As they say in gambling, quit while you're ahead. Stock traders are against that dictum simply because it is their livelihood to trade stocks, they earn from that trading and if you stop trading then what would happen to them? But I'd say that one time trading is good enough if you hit it big. Don't ask for more if you are not a gambler and unless you get the thrill of trading then you might as well quit while you are ahead.

 

I dont consider myself to trade at all. I invest. Buy and hold mainly, with some longer term holdings that I have plans to get rid of at some point.
Will I stop that? Never say never but I just don't see it happening as I'm after the passive income, not the capital gains.