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My Stocks and Shares ISA has underperformed this year so I’ve been looking at why. And while some things are out of my control, there’s one mistake that stands out to me.
Hindsight is always 20/20, but one of my portfolio moves has turned out to be a mistake that I could have avoided. The good news is that I think I can avoid a repeat in 2026.
Selling too soon
The mistake was selling my Citigroup (NYSE:C) shares. Exiting investments too soon has been an ongoing weakness in my investing and it’s one I’ve been working to get better at.
It doesn’t matter how good my investment ideas are, I’m not going to benefit if I sell too soon. It’s a bit like Noah building the ark but selling it to someone else just as it started raining!
Anyway, back to Citigroup. Jane Fraser’s plan to simplify the company by selling its operations in countries where it can’t establish a meaningful presence has been a very good one.
As a result, the stock trades at a higher price-to-book (P/B) ratio (which I predicted) and the company is buying back shares (which I also predicted). But none of that is much use to me.
My investment in Citigroup wasn’t a total disaster, by any means. I made a solid enough profit, but I sold my entire stake at around $85 in June and the stock is now trading at $111.
That’s a 30% gain in six months I missed out on. And while I sold because the stock had reached my estimate of its intrinsic value, it’s fair to say I made a mistake in moving on.
Lesson learned
Fast forward to today and I find myself in a similar position with a different stock. The Games Workshop (LSE:GAW) share price has doubled since I started buying shares in the company.
As a result, the price-to-earnings (P/E) ratio has gone up and the dividend yield has gone down. And I think buying the stock today is a much less attractive proposition as a result.
The pre-2026 version of me might have sold my shares to take advantage of some more obvious-looking bargains. But the effect of selling too early some of my ISA holdings this year is still very much front of mind.
In some ways, it’s easier with Games Workshop. It’s a company that I think has strong long-term growth prospects, rather than an underperforming firm with a lot of potential.
That’s not to say the stock is guaranteed to do well in 2026. Despite strong revenue growth in its core operations, the effects of inflation and US tariffs are starting to show up on margins.
This is a risk going forward. But while I’m not adding to my investment at today’s prices, the firm’s strong intellectual property is enough to convince me not to sell.
Warren Buffett
Warren Buffett once said that the stock market is a device for transferring money from the patient to the impatient. That was certainly the case for my Citigroup investment.
Fortunately for me, it shouldn’t be that difficult to do better going forward. And that’s what I’ll be aiming to do with my Stocks and Shares ISA in 2026.
