Stock Doc: Stocks, Emotions Don't Mix

Matt became blind to the very obvious data points that screamed "sell and move on with your life and money!" Sadly, he had watched his stock plummet from as high as $45 over the years. At the time Matt came to see me, Pfizer was cemented at a price of $26.

As Jim Cramer recently stated so vehemently, Pfizer should be viewed as a "$25 bond with no upside."

Matt remained numb to the realities of a barren drug pipeline, bad news with future star drug torcetrapib and a CEO with very little experience in the drug industry. There was also competition from new rivals and cost-cutting measures that slashed the jobs of the very same sales force that made this company great in 2002.

Matt also needed to be reminded that Pfizer's staple drug, Lipitor, would soon be losing its patent, which would certainly compromise any future chances for success.

The Treatment

As his performance coach, I advised Matt to cash out and memorialize his father in more productive ways. He had certainly profited from his father's gift, and I always preach to my clients that you can't draw oil from an empty well. I emphasized that if he remained faithful to this stock, he could potentially keep wasting the gift of profit that he had received.

We sat for an hour talking about ways to reinvest in the markets and even ways to invest in his kids' college funds. Matt was able to see that investing in his kids' education with his returns from Pfizer could carry on his father's legacy and at the same time be an even better investment down the road.

Perception is everything in reducing the anxiety associated with making tough decisions. Through our conversation, Matt was able to think less emotionally about his gift and at last make a confident and objective decision. Sometimes in situations like this, the best advice is to cut the cord and move on, since the future holds way more promise than the past.