Selling Dividend Growth Stocks: Reluctantly Ending 'Forever' Marriages

When I buy stock in a company, my intention is to hold those shares for years and years -- ideally forever. Furthermore, as a Dividend Growth Investing practitioner and a "serial dripper," I like to increase my stake in companies through reinvesting dividends. I also frequently use outside funds to add to holdings in both tax-advantaged and taxable accounts. After all, I researched these businesses thoroughly and felt strongly enough about their prospects to partner with them in the first place, so it makes sense to "top 'em off" when money is available and valuations are right. Intentions aside, however, partnerships sometimes end. It happens in the corporate world often, through spin-offs or sales or management changes.

For me, selling is the most difficult investing decision. Not only does it mean I'm giving up on a company I had researched and welcomed into the portfolio, but it also necessitates a second decision: buying a replacement company. In a perfect world, I'd stay with every company forever, for better or worse, through sickness and health. It's not a perfect world, however, and the investing landscape is ever-changing. So even after having said, "I do," sometimes -- reluctantly -- I will have to admit: "You know what? This relationship just isn't working for me anymore."

Source: Seeking Alpha

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