If the biggest pitfall of the Buffett strategy is the reluctance to part with a stock, it's also the secret sauce that allows compound interest to work its magic. Selling your shares after a pullback is often precisely the wrong thing to do – as long as your thesis is still intact. The only time you want to cut and run is when your thesis – the reason you bought the stock in the first place – starts to fall apart.
If Buffett's thesis on Wal-Mart was that its ubiquity and scale offered customers convenience and prices other firms couldn't match, he should've sold when Amazon.com (AMZN) began to disprove that theory.
Source: MSN Money
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