Mark Cuban: How I determine whether to hold or sell a stock

Mark Cuban: How I determine whether to hold or sell a stock

Investor Mark Cuban made billions of dollars during the dot-com boom by hedging his portfolio after selling his company, Broadcast.com, to Yahoo in 1999 for $5.7 billion in stock.
But Cuban wasn’t always an expert investor.
In fact, “I learned some expensive lessons when I first started trading stocks,” Cuban said Tuesday during an “Ask Me Anything” session on Reddit. “It was painful.”
Cuban had responded to a user asking for advice for those who recently lost money amid the GameStop trading frenzy, as the AMA was hosted by subreddit WallStreetBets , the same group that made headlines for helping the video game retailer’s stock price surge .
Back then, “[I] tried to learn what I got right and wrong,” Cuban said. But “[r]ight now, right here. The game is changing.”
For his own investments, when deciding whether hold or sell a stock, “BTC HODLers are a great example to follow,” Cuban said, referring to bitcoin investors who hold their position in the cryptocurrency. “Many bought at the highs in 2017 and watched it fall by 2/3 or more. But they held on because they believed in the asset.”
The same thinking applies to stocks.
“When I buy a stock, I make sure I know why I’m buying it. Then I HODL until I learn that something has changed,” he said. “The price may go up or down, but if I still believe in the logic that made me buy he asset, I don’t sell. If something changed that I didn’t expect, then I look at selling.”
Cuban admits that trading stocks “isn’t easy” but “time consuming and brain consuming,” he said in response to another Reddit user .
“As always DO THE WORK,” he said.
Disclosure: CNBC owns the exclusive off-network cable rights to “Shark Tank.”
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