You never go broke taking a profit, at least according to the well hackneyed stock broker saying. That may be true, but if you cashed in any gains from any of the ASX tech stock high-flyers a year or so ago, that advice has almost certainly seen you miss out on truly life changing returns.
You know the ones; the so-called WAAX stocks:
WiseTech (ASX:WTC) shares and Altium (ASX:ALU) shares have delivered gains of ~140% to shareholders over the past 12 months. Afterpay (ASX:APT) shares have roughly doubled that, while Xero (ASX:XRO) shares almost seem disappointing with ‘only’ a 76% return to shareholders over the same period.
Hindsight is, of course, twenty-twenty. The fact is that these companies — impressive though they all are — were already trading at eye-watering valuations a year ago. It wasn’t necessarily reckless to take some money off the table, especially given most shareholders were already sitting on substantial gains at that point.