Strategies for when you're holding a stock with a very large gain

- Stock has increased in value 10x over many years - Concerned it is overbought and may take a sudden dive of >20% - Strategies to protect gains: - Selling now incurs 20% Long-Term Capital Gains tax - Setting a trailing stop loss at 20% - Conditional exit plans like "One Cancels the Other" with Fidelity - Buying put options for protection, but unsure if cost-effective

🚨 Reddit sentiment: mixed/positive - Most comments suggest various strategies to manage gains while staying invested positively in NVDA or manage its potential downturns, reflecting a general positive outlook mixed with cautious approaches. Summarized comments: - If you think it may go down soon, but would prefer to hold longer, sell deep ITM leaps against your shares to buy back cheaper later when it’s lower. Worst case it just keeps going up and you lose out on more gains, but protect what you already have, for the calls to be exercise and your shares to be called away. Best case is you’re right and you can buy them calls back when it’s down to ride back up and hold longer - Sell covered calls to limit your upside but protect from downside - Do a collar strategy, sell covered calls, and use that money to buy puts. If it keeps going up, shares go away you still make money. If it goes down, you have your puts - Take out the initial investment and let the rest ride. Capital gains part sucks but everyone does what suits them - Utilize a Lombard loan against the stock if significant investment and you believe in it - Long term capital gains is 20%, no avoiding taxes - Investment psychology might play a role; sell whatever makes you comfortable - Consider long dated options, selling a $71 call and selling a $168 put, place collected credit in risk-free interest. In the long run, this approach might outdo just selling the stock now - Sell some shares and keep some - NVDA might feel oversold compared to the value of Microsoft and Apple, but it is also venturing into AI - Roll position into a cheaper call, take initial contribution back while allowing remaining shares to ride out any gains or losses. Helps reduce stress while staying invested Stock tickers discussed: NVDA