Byte #60: Three Stocks I Wish I Had Never Sold
Dear Readers,
One of the hardest parts of investing isn’t finding great companies.
It’s having the conviction to stay invested when the market is telling you to do the exact opposite.
If you’ve been investing for a while, chances are you’ve experienced this too. You do your research, build conviction, buy a wonderful business and then a sharp sell-off, disappointing headline, or fear of losing your gains makes you hit the sell button.
Unfortunately, I’ve done this more than once.
Looking back, three stocks stand out as some of my most valuable (and expensive) investing lessons.
1. ASML - The Cost of Trying to Time the Market
I wrote about ASML back in Byte #10. I remember how excited I was when I finally understood the business. It wasn't just another semiconductor company…it was a business with extraordinary technology, a dominant competitive position, and a critical role in the future of computing.
Then earnings were released, and the stock sold off sharply in pre-market trading.
Without thinking, my monkey brain took over. I hadn't lost conviction in the business, but I convinced myself I was making the prudent decision. With limited capital, protecting it felt like the right move. I sold around break-even, believing I could simply buy the stock back at a lower price.
Ironically, the stock eventually did fall below my target re-entry price.
But instead of buying it back, another thought crept in:
"If it has already fallen this much, how much lower can it go?"
That hesitation turned into inaction.
I never bought it back.
Today, the stock has more than doubled from where I originally purchased it.
Looking back, I didn't lose conviction in ASML, but I underestimated how difficult it is to time the market and overestimated my ability to know when to get back in.
2. Palo Alto Networks - Letting Fear Override Conviction
Palo Alto Networks was another company I believed in. Several investors and analysts whose work I respect considered it one of the highest-quality cybersecurity businesses available. After doing my own research, I reached the same conclusion.
I still remember calling my mom and excitedly telling her about the company. She isn't a business person but does follow the markets, and after I explained the business to her, she simply said, "This sounds like a really good company." At that moment, I felt genuine conviction in my investment thesis.
And yet, when volatility hit, emotions took over.
Technology stocks were under pressure from Saas sell-off, Microsoft was pulling back, sentiment turned negative, and once again I allowed market fear to influence my decision.
I sold PANW around break-even. Looking back, one of my closest friends is a cybersecurity expert, and I wish I had simply picked up the phone and asked her perspective. But in that moment, fear drowned out rational thinking.
The business continued executing. As AI adoption accelerated, it became increasingly clear that it wasn't replacing the need for cybersecurity - it was expanding it. Research from companies like Anthropic highlighted how AI could uncover and amplify new security vulnerabilities, reinforcing the need for stronger cyber defenses. The market eventually recognized this, and the stock nearly doubled.
Looking back, what changed was the narrative around the stock not the underlying business. I allowed a temporary shift in sentiment to override my long-term thesis.
3. Micron – Anchoring to an Old Story
Micron is probably the one that still stings the most.
I actually made an excellent return...roughly 400% in just a few months.
By most measures, that should have been a successful investment.
Given its run, I had told myself I would sell part of my position and continue holding the rest.
Instead, memories of Micron’s historically cyclical business took over. I worried the cycle was ending, convinced myself I was being disciplined, and sold the entire position.
The company kept executing and to everybody's awe the stock kept climbing.
Looking back, I wasn’t reacting to what Micron had become.
I reacted to what Micron used to be instead of recognizing what it was becoming. I was anchored to Micron's history as a highly cyclical business and failed to appreciate how AI was reshaping the memory chip industry through strong demand and tighter supply.
The Lesson I’m Still Learning
At first glance, these look like three different mistakes.
But they weren’t.
They were the same mistake repeated three times.
Looking back, these three mistakes had a common thread. My analysis helped me find great businesses, but my emotions and biases influenced how I handled uncertainty afterward. The lesson I'm learning is that finding great companies is only half the battle - the other half is having the discipline to stay rational when the market tests your conviction.
That doesn’t mean every sell decision is wrong. Sometimes businesses genuinely deteriorate, competitive advantages weaken, or valuations become difficult to justify.
The challenge is knowing the difference.
I’m still working on it.
Before making a decision today, I try to pause and ask myself this question:
Has the business changed or is it just the stock that’s broken?
Answering this question forces me to focus on the underlying business, not the emotions surrounding the stock price. It isn't always easy, but I believe the more I practice this discipline, the better I’ll get.
Investing is as much a psychological game as it is an analytical one.
We’re all going to make mistakes.
I’m certainly no exception.
What matters is learning from those mistakes and making fewer expensive ones over time.
I keep reminding myself that investing, much like life, is about marginal improvements. Every lesson, every mistake, and every uncomfortable decision is an opportunity to become a slightly better investor.
Those small improvements don’t seem significant in the moment.
But over years, they compound…just like our investments.
What investing mistake taught you the biggest lesson? I’d love to hear your experience in the comments.
Until next Monday,
Pooja
