In general, there are some intrinsic reasons to sell a stock—i.e., reasons that are related to the stock itself and/or the markets. In addition, the investor may also have extrinsic reasons to sell; by extrinsic, we mean reasons that are related to the investor’s finances or lifestyle. Occasionally, the sell decision may be triggered by a combination of intrinsic and extrinsic factors.
Let’s look at some intrinsic reasons or factors first.