• George Kiraly

Scrub Your Portfolio of Its Cobwebs

Although we're technically still stuck in the winter season, Spring is around the corner. Now is a great time to get to work scrubbing your portfolio of its cobwebs.  

A new season is fast approaching, presenting you with an opportunity to review your investments and weed out the weak positions in your portfolios, especially those that have been lagging the market in recent months. The idea is to sell your laggards, or those stocks that are moth-eaten, pilled and faded. Now is the time to lose the emotional attachment to that favorite stock.

Given the recent market turnaround off the December 24th market low (the S&P 500 has rallied +19.20% from 12/24/18 to 3/5/19), now is a great time to reassess your portfolio, including your investment holdings and allocation mix.





Use this period to identify those areas that have the wherewithal to continue leading and those areas that may have bounced with the market but remain weak on a long-term relative strength basis. The point being, the stocks that have been left behind, so to speak, are ones to consider "cleaning" out of your portfolio. After you have cleaned out the laggards, you are able to use the freed up capital in more productive ways.

Selling laggards unlocks capital to be put to use elsewhere. After all, it makes no sense to have capital remain in investments that aren't participating in the rally. These are technically weak securities, and any continued investment in them is just "dead money".


George Kiraly Jr., CFP®, MBA is a NAPFA-Registered Financial Advisor.

Disclosure: George Kiraly Jr., CFP®, MBA is the Founder & Chief Investment Officer of LodeStar Advisory Group, LLC, an independent Registered Investment Adviser located in Short Hills, New Jersey. George Kiraly, LodeStar Advisory Group, and/or its clients may hold positions in the ETFs, mutual funds and/or any investment asset mentioned above. The opinions offered herein are not personalized recommendations to buy, sell or hold securities. The above commentary does not constitute individual investment advice. The strategies discussed are strictly for illustrative and educational purposes and should not be construed as a recommendation to purchase or sell, or an offer to sell or a solicitation of an offer to buy any security. This material represents an assessment of the market environment at a specific time and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any security in particular.

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