Have you ever watched a trade that looked bulletproof suddenly turn on its head overnight? It’s one of those moments that reminds even the most confident investors that markets don’t owe us anything. As we’re wrapping up 2025, one well-respected market strategist is taking decisive action, trimming positions that have treated him well but now show signs of fatigue. It’s a classic case of knowing when to say goodbye – even to winners.
Smart Moves at Year-End: Why Selling Now Makes Sense
I’ve always believed that the best investors aren’t the ones who pick the hottest stocks – they’re the ones who know when to step away. With just days left in the year, this strategist is doing exactly that, closing out several trades to reposition for what’s ahead. It’s a reminder that portfolio management isn’t just about buying; sometimes the toughest, and smartest, decisions come on the sell side.
What caught my attention is how disciplined the approach feels. No emotional attachment, no hoping for one more rally. Just clear-eyed assessment of price action and shifting opportunities. In my experience, that’s what separates consistent performers from the crowd.
The Dramatic Exit from Gold
Gold has been the story of 2025, hasn’t it? Up over 64% in the popular exchange-traded fund tracking the metal – crushing the broader market’s respectable but more modest gains. Anyone holding precious metals this year probably felt pretty clever. But then came that sharp overnight reversal, the kind that makes you sit up and pay attention.
The strategist didn’t hesitate. He completely exited his position in the gold ETF, citing that violent price swing as an unmistakable warning signal.
“You cannot ignore the type of price reversal that we saw last night and sit there and do nothing. So you have to, at that moment, reduce your risk.”
That’s the quote that stuck with me. It’s not about panic selling – it’s about respecting the message the market is sending. He described it as ringing the register on a small winning trade, locking in gains while they’re still there. And honestly? That’s often the right call.
Perhaps the most interesting part is his openness to coming back. This isn’t a permanent divorce from gold; it’s more like taking a breather. Watch for better entry points, reassess the macro picture, then potentially rebuild the position when the setup looks cleaner. I’ve found this kind of flexibility keeps investors from missing the next leg up after getting shaken out.
- Gold’s massive run created substantial profits for many holders
- Overnight reversals can signal shifting sentiment quickly
- Reducing exposure preserves capital for future opportunities
- Discipline in taking profits often beats hoping for more
It’s worth asking yourself: if you were sitting on similar gains in a volatile asset, would you have the conviction to step aside after such a dramatic move? Food for thought as we head into 2026.
Shifting Gears in Energy: From Refiners to Explorers
The energy sector has been another area of rotation this year, and our strategist is adjusting accordingly. He entered a position in a major oil refiner back in mid-July, riding a nice move higher. The stock has performed well, up over 12% year-to-date and even outperforming the market over the past six months.
But here’s where it gets interesting – he’s completely exiting that position now. Not because the trade went wrong, but because he sees better relative opportunities emerging elsewhere in energy.
Specifically, he’s anticipating that leadership may shift toward the large exploration and production companies. Think giants in the space that are more directly leveraged to crude prices and drilling activity. Names that have the scale and balance sheets to capitalize if the macro environment stays supportive for energy.
This kind of sector rotation thinking fascinates me. Refiners had their moment when crack spreads were favorable and demand recovery played out. But markets are forward-looking, always searching for the next theme. If the strategist is right, capital may flow toward companies with greater upside to commodity prices themselves rather than the middlemen processing them.
In my view, this highlights something crucial about successful investing: staying attuned to changing leadership within sectors. It’s not enough to be right about energy overall – you need to be in the right part of the value chain at the right time.
When a Trade Just Doesn’t Work: The Streaming Story
Not every position pans out, and that’s okay. The strategist was candid about closing out a more recent trade in a major music streaming company that simply failed to gain traction.
He entered the position about a month ago, but the stock has been in a clear downtrend since late June. Over the past six months, shares have declined more than 24% – a painful stretch for anyone holding through it.
What I respect is his willingness to set a mental time limit. When the thesis doesn’t play out within a reasonable timeframe, he moves to the sidelines. No digging in heels, no averaging down out of stubbornness. Just acknowledging that this particular idea isn’t working right now.
“I just timed myself out. It didn’t go anywhere and you move to the sidelines.”
Simple as that. There’s real wisdom in knowing when to cut bait on non-performing positions. Capital tied up in dead money can’t be deployed where it’s actually working.
He also noted similar price action in another big streaming name, suggesting broader pressure on the sub-sector. Sometimes these moves are company-specific, sometimes they’re industry-wide rotations. Either way, recognizing the pattern and acting accordingly matters more than being “right” about the original thesis.
What This Tells Us About Year-End Portfolio Management
Stepping back, these moves paint a picture of disciplined, opportunistic investing as we close out 2025. Three different positions, three different reasons for exiting, but a common thread of proactive risk management.
One trade hit a technical warning signal after massive gains. Another reached the end of its relative leadership phase within its sector. The third simply failed to perform within the expected timeframe. In each case, the response was swift and decisive.
- Respect violent price action as potential inflection points
- Monitor shifting leadership within sectors
- Set reasonable time horizons for new positions
- Preserve capital and mental energy for better opportunities
- Remain open to re-entering former positions at better levels
These aren’t groundbreaking concepts, but executing them consistently? That’s what builds long-term success. Too many investors fall in love with their positions or refuse to admit when something isn’t working.
As we turn the page to 2026, markets will undoubtedly bring fresh challenges and opportunities. Interest rate paths, geopolitical developments, technology adoption curves – all the usual suspects that keep us up at night. But watching professionals navigate these transitions reminds us that process often matters more than prediction.
Lessons for Individual Investors
If you’re reviewing your own portfolio this December, consider asking yourself some of these questions:
- Are any of my biggest winners showing technical deterioration?
- Have industry dynamics shifted since I first bought certain positions?
- Am I holding any trades that simply haven’t worked despite a favorable market?
- Where might capital be better deployed heading into the new year?
- Do I have dry powder for opportunities that may present themselves?
Year-end is a natural time for reflection and rebalancing. Tax considerations come into play for some, but even beyond that, it’s worth taking stock of what’s working versus what’s not.
In my experience, the investors who regularly prune their portfolios – taking profits in extended winners and cutting losses in laggards – tend to compound capital more effectively over time. It’s not glamorous, but it works.
The strategist here provides a real-world example of that philosophy in action. No drama, no second-guessing, just methodical adjustment based on current conditions. As markets evolve, so must our positioning.
Whatever 2026 brings – whether continued rotation into new leadership areas, renewed volatility, or something none of us anticipate today – staying adaptable remains key. The willingness to sell, even when it feels uncomfortable, often creates the flexibility needed to capitalize on whatever comes next.
That’s the real takeaway as we close out another eventful year in the markets. Sometimes the smartest move isn’t buying the dip or holding through thick and thin. Sometimes it’s simply knowing when to step aside and wait for clearer skies.
Here’s to making thoughtful decisions with our capital as we head into a fresh year full of possibilities. May your portfolio reflect not just where the market has been, but where it’s going next.
