Virtually all investors have some losers in their portfolio. Benj certainly does. Every year he usually sells one or three, but even then, others are sitting in the portfolio not doing much except looking plug ugly. Rather, he keeps reporting gains on profitable sales to the tax authorities and they keep taking their pound of flesh, without so much as a “thank you.”

But this year he has decided that the time has come to get rid of some of the flailing elders that he owns. As investors can go back up to three years to claim their losers against gains, he can potentially offset some old wins – depending on how big his winners are this year.

One rule that he normally abides by is not selling any duds that have been held for less than two years unless it is quite obvious that a recovery is exceptionally unlikely. He would prefer to wait and give the potential turnarounds a longer period of time to germinate. Of course, that might simply be too optimistic a hope. And when looking at how to pay the government less by culling losers, simple optimism is not helpful. A dose of harsh reality and ruthless execution is in order.

So here are a couple that he is strongly considering offing well before the end of the year and were written about in this newspaper. Waiting until December when most people are rushing their also-rans out the door makes little sense from this angle. The increased supply affects the price to the downside and in these cases, there is already enough negativity baked into the stock prices.

The first he is looking at potentially booting is GSE Systems Inc.

Why did he not sell here? Stubbornness? Stupidity? Tough to know exactly, but he should have stuck to his regimen of selling quickly when a stock consolidation is going to happen. As he wrote in his best-seller, The Uncommon Investor: A a contrarian’s guide to investing in the stock market: “Without discipline, you have no method.” Those six words covered a whole page. He still kicks himself for not following his own directive. Thankfully though, he did not sell recently as the stock has doubled this month.

Another stock that we wrote about in this column, a year ago in fact, was Gold Resource here are some other failures in the portfolio unfortunately. These include Air Industries Group. Selling losers is psychologically negative. The only conclusion that can be reached is that mistakes have been made and one is not perfect. For many people, it is not easy to admit fallibility.

A key thing when dumping failures is to analyze what went wrong. Each position will likely have at least one lesson that can be drawn, if not numerous. Hopefully the schooling will help one avoid making similar mistakes in the future. It is better to flush money down the toilet with a learning experience, rather than to wave goodbye while learning nothing. And remember: don’t fall in love with a stock – it will not love you back.