I bought NVDA before the massive price surge, so I feel pretty lucky with how things turned out.
Here’s the situation: I own 800 shares worth about $100,000, but that’s 50% of my individual stock portfolio. This is a significant amount for me, especially since I don’t come from wealth.
I’m 35 with a growing family, and this year is unique since I’m taking a lot of time off work for family bonding, potentially dropping me into a lower tax bracket. I plan to confirm this with my CPA.
If I sell some NVDA, I’d use the gains to buy index funds like those tracking the S&P 500. I feel more comfortable with this plan, even if it means possibly missing out on NVDA’s future growth. I also suspect there could be a short-term pullback on NVDA and the broader AI sector.
I want to hold onto some shares for the long term but need help figuring out how much. Any thoughts?
(And yes, I know people will say “buy more,” haha.)
@Rowan
Yeah, I’d trim down. 50% in one stock is risky, especially with a growing family. Maybe keep 100-200 shares for long-term growth and move the rest into index funds.
Rowan said: @Rowan
Yeah, I’d trim down. 50% in one stock is risky, especially with a growing family. Maybe keep 100-200 shares for long-term growth and move the rest into index funds.
This makes sense. Diversifying into index funds while keeping a small core NVDA position is smart. Peace of mind is valuable.
Are these long-term capital gains (held for over a year)? If so, the tax rate is lower.
If you’re in the U.S. and filing jointly, long-term capital gains are taxed at 0% up to $97,700 of taxable income. Make sure to calculate this carefully.
Second, think about what you’d do if you had the $100k in cash today. Would you reinvest it all in NVDA or diversify?
Good luck with your decision and congrats on your growing family!
You mentioned you’d feel more comfortable diversifying. That’s an important part of personal finance. No one knows where NVDA will go next, but it sounds like you already know what’s best for your situation. Just stick to your plan and don’t second-guess yourself.
Instead of selling, you could rebalance over time by buying other stocks or index funds. Let NVDA become a smaller percentage of your portfolio naturally.
I’d sell at least half, maybe more. 25% of your portfolio in one stock is still a lot, but it’s more manageable than 50%. Great job riding the wave with NVDA, though!
If you believe AI might see a pullback, it’s definitely worth selling at least some shares. How much depends on your risk tolerance and conviction in NVDA long-term.
Decide if you’re an investor or a gambler. If you’re an investor, sell most of it and buy index funds. You can still get NVDA exposure through something like QQQ.