Bring Out Your Dead…
Bring Out Your Dead…
10/30/24
Owning poor-performing stocks often stir feelings of frustration and avoidance, similar to the comedic portrayal in Monty Python and the Holy Grail — "Bring out your dead!" While it is easy to dismiss these struggling investments, doing so can leave you with a portfolio full of "dead" assets that drag down your overall returns.
When speaking with new clients, we frequently hear similar responses to underperforming assets:
Forgotten Investments: "I don’t remember when or why I bought that stock."
Unclear Future: "I have no idea what this investment’s future prospects are."
False Optimism: "I’m just waiting for it to get back to even so I can sell."
While understandable, this approach is not productive. These neglected investments can cost you in opportunity and drag down performance. We often begin relationships by taking a hard look at these under-performers, with the goal of transforming them into productive, wealth-building assets.
Why It’s Important to Address Underperforming Investments
Holding onto poor-performing stocks for emotional reasons or simply hoping they "turn around" can be costly. It is not uncommon for investors to become attached to certain investments based on the initial promise or the time they have already spent holding them. However, letting go of these emotional attachments can free up capital for higher-quality investments that are aligned with your goals.
Our Approach: Turning Sows' Ears into Silk Purses
At Mad River Investors we focus on opportunistic investing — finding the best possible way to reposition underperforming assets. This might involve selling, reallocating capital to more promising opportunities, or conducting thorough analysis to determine whether an investment's outlook has fundamentally changed.
We also know that approximately 10% of most portfolios are often made up of neglected or underperforming investments. These can be stocks that investors no longer follow closely, but they represent significant lost opportunity for wealth-building.
Rather than letting these "dead" assets linger, we can work with you to assess and reposition them in a way that maximizes your returns.
Why Now Is a Good Time to Review Your Portfolio
With market conditions constantly evolving, now is the perfect time to assess your portfolio. We encourage you to take a closer look at your investments and identify any assets that may no longer align with your goals. At Mad River Investors, we are happy to help you evaluate your holdings and provide insights into how to turn underperforming stocks into productive parts of your portfolio.
Next Steps
There’s little downside in reaching out to review your portfolio with us. With our 30 years of experience managing money, we are confident we can help you turn sows’ ears into silk purses.
Let’s start the conversation— feel free to contact us with any questions or concerns about your investment assets.
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