A few years ago I signed up for a bunch of FinTech investment apps which gave me some free shares after meeting certain criteria. Recently I have consolidated all my assets in Fidelity and I'm working on simplifying my portfolio.
My 401k, IRA, and HSA are all invest in total market mutual funds which is the only thing I plan on investing in from now on. The problem is I still own a few shares in over a dozen companies and I am wondering if I should just sell them.
They currently make-up a very small portion of my portfolio so I don't think it matters either way but I wanted to talk to some people about it before doing anything. I'm the first in my family to have any sort of financial stability so stuff like this stresses me out.
Here are the pros and cons I have come up with.
Pros of Selling:
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Simplifying My Portfolio. The main reason I want to sell them of is because owning nothing but mutual funds makes my portfolio easier to manage. The individual companies might complicate my tax returns and make my returns “nosier” due to their individual performance.
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Lock In Gains. Currently almost all of the stocks I own are up due to the excellent market performance, so if I was going to sell them I feel that this would be a good time. I'll make a few thousand dollars which I could put into my emergency fund or a mutual fund.
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Avoid Financial Complexities. I eventually want to do things like buy a house which I believe includes a thorough review of my finances. So in my mind owning only mutual funds will make such a review process simple and prevent possible issues for me in the future.
Cons of Selling:
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Missing Out On Growth. While it's possible the stocks will go down there is a chance they will go up and beat the market in the long run. As of right now they have all outpaced the market. I only own between 1-20 shares in each company so the gains would be small though.
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No More Dividends. The one thing I have enjoyed about owning these shares is getting a steady stream of dividends. They're small but consistent and since they're all long-term I pay no taxes on them which is great.
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Tax Headache. While I believe the sale of all these shares won't trigger any tax problems I worry since some of the companies are foreign (e.g. BABA) or in small-cap companies. I can list the companies if people think that information is relevant.
My conclusion is that it's best to just sell them and be done with it, but I would love to hear what people on here have to say.
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