BALTIMORE (Stockpickr) -- Don't get distracted by cheers on Wall Street this week. While most investors are busy celebrating another set of all-time highs in the stock market, a handful of "toxic" stocks could be ravaging your portfolio returns.
Make no mistake -- I'm not warning you about an impending crash today. This column isn't my version of a cardboard sign that reads, "The end is near". In fact, I've made no bones about the fact that I've been bullish all year.
But there's a big difference between thinking that the broad market is going to move higher, and thinking that every single stock is going to go higher. It's the laggard names that will gut your performance if you aren't quick to unload them.
That's why we're taking a closer look at five "toxic stocks" you should be selling in November. To be fair, the companies I'm talking about today aren't exactly "junk."
By that, I mean they're not next up in line at bankruptcy court -- but that's frankly irrelevant. From a technical analysis standpoint, they're some of the worst-positioned names out there right now. For that reason, fundamental investors need to decide how long they're willing to take the pain if they want to hold onto these firms this summer. And for investors looking to buy one of these positions, it makes sense to wait for more favorable technical conditions (and a lower share price) before piling in.
For the unfamiliar, technical analysis is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's price action and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better planning their stock execution.
So, without further ado, let's take a look at five "toxic stocks" you should be unloading.