Exit Plans: When and How to Leave a Good Investment on Purpose

Shrey Sankhe
Apr 10, 2024
2 min read

Updated: Oct 15

Most financial advice hammers one thing: hold. Buy great assets, hold them forever, and let compound interest do its thing.

But here’s the truth: holding forever isn’t always smart. Sometimes, the bravest move isn’t to keep believing in the asset — it’s to walk away from it, on purpose.

This episode of The Return is about something few people talk about: how to leave a good investment. Not in panic. Not in fear. But with a plan. With purpose. With clarity.

Because here’s what happens: You buy something with a clear thesis. It starts working. It grows. And then? You do nothing. You keep holding. Not because it still fits your goals — but because you’re scared to let it go.

Let’s break that.

Why Holding Forever Can Hurt You

The longer you hold, the more attached you get. The more gains you see, the harder it is to sell. But great assets aren’t always great positions.

If the reason you bought no longer holds, or the opportunity cost has changed, or the size of your position is now risky — keeping it is no longer discipline. It’s denial.

Three Exit Triggers Every Builder Should Define

Before emotions take over, define your exits:

Fundamental Exit The asset changes. Management, business model, regulation, macro exposure — something shifts and your original reason for entry disappears.
Goal-Based Exit You needed $10K for tuition. You hit $10K. Sell. You aimed for a 2x return. You got it. Move on. Don’t let gains override the goal you set out to hit.
Rebalance Exit That one stock that ballooned to 40% of your portfolio? Time to trim. Selling part of a winner isn’t betrayal. It’s risk management.

Set these triggers early. Before greed or fear start talking louder than logic.

Exiting Doesn’t Mean Quitting

This isn’t about giving up. It’s about redirecting momentum. From something that was working… to something that will work better going forward.

Capital is fuel. And your job isn’t to hoard it — it’s to deploy it where it matters most now.