It's hard to sell a winner. Any time I even think about selling some Novavax shares (NASDAQ:NVAX), the darn stock price goes up another 6%. I also haven't taken any profits yet from my investment in the biotech because I haven't even owned it for a year, and there are tax advantages to hanging on at least that long.
Historically, my worst investment mistakes were my sales. Over a decade ago, I sold Amazon and I sold Netflix. That's kind of like leaving $1 million on a bus.
Don't kid yourself about selling a stock -- it's the most dangerous thing you can do in the stock market. Forget about all those bad buys you and I have made over the years. What did you lose in your worst picks, 90% of your money? All of those poor purchase decisions are so irrelevant.
It's the sales you make too soon that haunt you.
I bought Novavax because of its flu vaccine candidate, NanoFlu. At the time, we were all waiting on news from a pivotal clinical trial. It seemed to me that the possible reward greatly outweighed the risk, so I bought shares, and added to my position in January. And then in March, the company delivered positive results from its phase 3 study.
By then, that news was almost irrelevant. The stock market (and much of the world) was (and remains) laser-focused on COVID-19. And Novavax is now pursuing a vaccine for that disease, NVX‑CoV2373. That's why my Novavax stock holdings are skyrocketing -- it was an unpredictable, black swan event.
A month ago, I said Novavax was a buy at $48. Today, I think it's still a buy at $83. Novavax has a good shot at winning this race.
Will I take some profits before the phase 1 clinical trial data for NVX‑CoV2373 is announced in July? Yes -- because it's a binary event, and anything can happen.