Not Taking Profits Can Be an Investor's Downfall

Peter Thiel, a venture capitalist, and Softbank, a fund manager, dumped nearly $6 billion of shares in the hyped AI company Nvidia this month. Their move comes after Nvidia has climbed 1,280% in five years.

By locking in their gains, Thiel and Softbank reminded me of a lesson best articulated by Malaysian trader and entrepreneur Robert Kuok.

Not knowing when to take a profit is the Achilles’ heel for a trader. Take profits! Don’t wait. If you have a profit, you have to take it. If you wait, it will be your downfall.
— Robert Kuok

Kuok was born in 1923 and was so poor as a boy that his mother had to cut up old flour sacks to make his underwear.

"I was very ashamed to be seen by other students," he later wrote, "when I had to take off my outer pants in the locker room for sports day."

Kuok's business acumen transformed his circumstances. Today, at 102 years old, he has a fortune worth $17.4 billion. I highly recommend his deeply moving autobiography, Robert Kuok: A Memoir.

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