Cashing in on some shares

[Galactica]

I have shares in Sasol and PSG investments, I need to cash in all of Sasol and a portion of PSG. I need the cash end of April 2014 for a serious reason but I see the shares are trading very high at the moment. Should I sell now or should I wait for late April? Do you think the prices will be higher in April? I have to make the same decision for a portion of Satrix 40 that I need to sell. I know events like results/dividend announcements can increase share prices but I don't see any of that coming up for these companies before the end of April. Please advise.

 

[Hendrix]

Mmm, very interesting question thats hard to answer, actually impossible.
Here's my thoughts, the JSE is trading above its fair value, and a major correction can happen at any time, but no-one knows when, but it will.
So we keep riding the stocks hoping it just continues to go up.
PSG and Sasol are both very good stocks, with PE's of around 18 and 10 respectively, I think Sasols price can still climb a lot.

So if it's for something serious, maybe you should take your profits now, you might not want to risk the market correcting and losing.
Then again, it might continue up for quite some time, and you kick yourself for selling too early.

I guess it's all down to your risk appetite, and how urgently you need the cash...

 

[Arthur]

No-one can say. If they could they'd be on their private island.

Hendrix is right. It's good common sense, and psychologically much less taxing: take a known price now and bank it for the intended purpose. Don't fret about what it turns out to be at the end of April.

Or not.

The decision can only be yours.

 

[BloodBurner9000]

Sell the portion you will need in the next few months which you cannot afford to loose.

Plain an simple.

Look at it this way - starting with cash, would you have invested the money now in PSG and SASOL shares, selling in April for what you have termed "a serious reason"? Off course not because investing in equities short term is very risky! The answer seems much more certain in this case although it is equivalent (less trading fees) to your scenario.

 

[geezer]

Below is a graph of the Sasol Share price for a year period.

It has steadily grown during this period, with the usual ups-and-downs. The next major event in the Sasol financial calender is in September when they announce their annual report. That usually shakes the share price a bit. Historical data indicates that it should climb some more, but ANYTHING can happen!

 

[chicken247]

15 - 20% correction in Sept-Nov 2014. Cant correct before or directly after elections imo.

 

[ScottulusMaximus]

Definitely sell SASOL now, they've just cancelled a massive clean fuels project due to government regulation screw ups and will be sinking millions into the new project after the elections once the government has pulled finger and given them the final regulations...

Stock will probably take a small dive once it's all announced.

 

[Galactica]

Thanks for the valuable advice.

 

[Cius]

Hard call. My boss just cashed in some share options and a week later the shares went up by almost 10%. Really hard to time the market.

 

[Hendrix]

Don't forget that SARS will take 33.3% as Capital Gains Tax if you held it for 3 years min. This amount will be added to your other earnings.
If you held it for a shorter period, then 100% of your gains will be added to your other earnings. So take tax into consideration when selling.

You will only pay tax on 33.3% of the CGT (the other 66.7% is exempt), so if your marginal tax rate is say 40%, you will effectively pay about 13.3% tax (33.3% - 60% = 13.3%), and if I recall correctly, something like the first R20k or so is tax free...

 

[archibald]

Sell before 15 April.The JSE Casino is being by fed by greed.

 

[bromster]

If you are satisfied by your current earnings, sell. Do not procrastinate. I was up 18% with BHP Billiton last month and decided to keep them. Naturally, they dropped to 5% within a week, now I'm crawling my way back up to 11% as of Friday.

These things are nearly impossible to predict.

 

[Hendrix]

Sell before 15 April.The JSE Casino is being by fed by greed.

You have crystal ball? Or just a short circuit between your brain and your mouth?

 

[modern10]

You have crystal ball? Or just a short circuit between your brain and your mouth?

Hahaha