Earlier today, Rick Schwartz wrote a post I kind of disagree with in the sense that his strategy is the optimal approach for his specific financial situation but not necessarily the best approach for everyone.
Rick is probably the most talented domainer when it comes to extracting the highest value out of a sale but what I will try to explain today is that extracting the most value out of a sale is not always the best approach and that even if it sounds weird, you *can* be a successful investor by flipping under the right circumstances.
One of the statements from the post I linked to that I disagree with is this:
“MOST domainers would flip that domain for $5k in 24 hours. BAD MOVE!!!”
In my opinion, flipping a domain for $5k in 24 hours can be a very good move if and only if you allocate that $5k in a correct manner.
In other words, if you sell a domain at a quick $5k profit in order to allocate that capital in a way that you are convinced will generate more than by keeping it.
Maybe you will buy another domain, maybe you’ll invest in something else that you are convinced will generate a higher return.
You get the point.
Rick is a very well-funded domainer, so his strategy of extracting the most value out of each sale works best for his financial situation.
What I am trying to explain is that it’s not necessarily the best choice for everyone.
Let’s assume someone offers to buy one of your domains at a $5k profit and that at the same time, an investment opportunity you consider amazing presents itself.
If you already have enough capital to invest in that opportunity without selling the domain, then I agree with Rick 100%. Don’t just sell for the sake of selling. If you can invest in that great opportunity *and* keep your domain, do it, that’s definitely the best approach.
Unfortunately, most people cannot do that due to liquidity-related reasons.
For those people, in my opinion, taking the $5k profit by selling the domain in order to invest in something (maybe another domain, maybe another opportunity) that they are convinced will generate a higher return might be a better solution.