Sell in anticipation of a dip?

[Smurf Hunter]

Aside from commission/transaction fees and some missed gains, is there any downside to exiting a position when you've made 20-30%, wait for a correction, or "bad day" and re-enter the position with equal or greater shares?

If this is a viable approach, are their guidelines or philosophies about any metrics?

I'm thinking how in football there's a commonly accepted "field goal range" where you're too close to punt. I don't need exact details or advice, just wondering how others think about this stuff.

[CharlesH]

Well, the downside of selling on the highs and buying on the dips is that you may sell and the stock/fund/cryptocurrency/etc. may just keep going up.  Or you might buy back on the dip and your item just keeps dipping down to zero...
 
Philosophically, I stick to a general level of diversification and try keep the portfolio in line with how much risk I can afford.  I use index stocks and very short-term bond index funds and just rebalance 1-2 times a year to get back to my chosen diversification level.  No homeruns. No ground-outs.  Very boring.  But for me it has worked.

[Smurf Hunter]

Philosophically, I stick to a general level of diversification and try keep the portfolio in line with how much risk I can afford.  I use index stocks and very short-term bond index funds and just rebalance 1-2 times a year to get back to my chosen diversification level.  No homeruns. No ground-outs.  Very boring.  But for me it has worked.

Generally I do too, but as a recent example, the S&P500 is up around 20% in the past year.  That's not normal.  I instinctively want to harvest that, as it seems likely to recede.

[CharlesH]

Generally I do too, but as a recent example, the S&P500 is up around 20% in the past year.  That's not normal.  I instinctively want to harvest that, as it seems likely to recede.

 
I agree with you and I do re-allocate, once or twice a year regardless of gains or losses in the stock market.  However, I did reallocate in December (off my cycle) because of those gains you mention.  I’m in my mid-50’s and try to stay around 2/3 stocks and 1/3 cash.  I rebalanced back to that allocation in December.