For stock market investors, year’s end is a good time to review your portfolio. Making changes before the end of the year will impact your tax burden for 2024 — so now is the time to consider locking in any losses or gains so you can make the necessary trades before the end of the taxable year.
If you invest in a lot of individual stocks, this is also a great time to stare down any investments that you might want to exit regardless of the tax implications. Ask yourself if your original investment thesis still feels correct, and think about what the next year might hold. A new presidential administration, the inflation outlook, what the Fed has signaled they might do with interest rates — all of these factors and more could influence whether or not you want to keep holding your current investments.
According to investment experts, there are 10 stocks that you should definitely consider dumping before we head into 2025. If these companies are in your portfolio, take note.
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Big defense contractors have typically been pretty safe bets in the stock market, although Boeing’s struggles over the last year during a rising market clearly show that isn’t always the case. Peter C. Earle, senior economist for the American Institute for Economic Research, sees possible trouble ahead for the industry.
“Should the incoming Trump administration follow through on its pledges to force other nations to fend for themselves, the largest publicly traded defense contractors might be poised for a pullback: Lockheed Martin (LMT) and Raytheon (RTX),” Earle said.
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Earle also sees risk in the green energy sector, noting that the Biden administration’s Inflation Reduction Act provided for a large amount of subsidies for renewables. “If those are reduced or eliminated, many of the solar, wind and alternative energy source firms will be in serious jeopardy. Two of those may include Enphase Energy (ENPH) and NextEra Energy (NEE),” Earle said.
Earle also noted that a cornerstone of the Trump campaign was tariffs and other forms of trade protectionism — a term for government policies that restrict international trade with the intent of helping domestic industries. Such measures are often controversial because of the unintended consequences that can arise from them.
