Taking profits in Intuitive Surgical and Autodesk
28th June 2017 |
Action to take: sell ISRG and ADSK
Intuitive Surgical Inc (ISRG)
Day range on 28.06.17: $930.05 – $943.93
52-week low/high: $610.71 – $963.54
Autodesk Inc (ADSK)
Day range on 28.06.17: $102.5 – $106.45
52-week low/high: $50.42 – $114.68
I am writing to you today because I believe it is time to take profits in some of our best performing positions. These are Intuitive Surgical and Autodesk.
The reason is not because there is any particular change in the business of these companies or that anything has changed in the long-term bullish outlook. That is why I will be looking to buy again should the shares pull back to their respective trend means.
However there are macro considerations that are occurring in the broader market that suggest now is the time to reap rewards rather than sow. The Nasdaq 100 looks increasingly like it has hit at least a near-term and potentially medium-term peak. During a mean reversion it is often the shares that have done best that are most likely to experience profit taking, which is why I think you should sell Intuitive Surgical and Autodesk.
There is no such thing as a bull market that does not experience occasional medium-term setbacks over the course of a three to five-year move. Therefore it is always an important consideration whether one should take profits when something has done very well and try to buy it back later, or should one sit out the pullbacks so that the position is held on to for the long term.
Personally I favour conditioning myself to taking profits because that makes the ultimate design to sell easier. The problem with exhibiting a willingness to sit out potentially major pullbacks is that one has less of a rationale for selling when there are genuine top formation characteristics evident.
To be clear, I do not think this is a major top like we saw in 2000 or 2008 but it is entirely possible the market could range for a few months with some of the most overextended shares taking the brunt of selling as they revert to their respective means.
Sell Intuitive Surgical at market to lock in a profit of 47% and sell Autodesk at market to lock in a profit of 46.8%.
Action to take: sell ISRG and ADSK
Intuitive Surgical Inc (ISRG)
Day range on 28.06.17: $930.05 – $943.93
52-week low/high: $610.71 – $963.54
Autodesk Inc (ADSK)
Day range on 28.06.17: $102.5 – $106.45
52-week low/high: $50.42 – $114.68
All the best,
Eoin Treacy
Investment Director, Frontier Tech Investor
