Dropping domains from your portfolio can be a good thing

I saw this tweet today and it made me think a lot about my first few years as a domain name investor.

While we all buy domains names and think at the time they would make good investments, a year or two later, it’s okay to realize that some aren’t. Most of the domains I’ve dropped over the years are domains I either hand-registered or bought off the drop for $50 or less.

It can be easy to develop a bit of sentimental attachment to a domain. I’ve seen this happen with a domains that follow a certain theme, like maybe you find out there’s a new trend and register a bunch of domains like: <trend>now.com, <trend>online.com, <trend>blog.com, etc. While you might have stumbled on a new trend, you’ll know soon enough if offers and sales start coming in, if not, then dropping the 20 names you hand-registered doesn’t just save you money, it can actually be leveraged to make better investments.

Here’s what I do when I drop domains. Over a given quarter, I look at the total dollar amount I’m saving from domains I dropped, then I usually put that into one or two names. My logic here has always been, if I drop 20 domains that I probably would never sell, and buy one domain for $200 that I could sell for $2,000 – that’s a better move.

Don’t be afraid of looking back a year later and thinking, why the heck did I buy that name? It happens to everyone, the key is, over time, learning which names in your portfolio are real assets that will sell for a good ROI over time, and which are actually liabilities that will cost you $10/year just to sit in your portfolio.

{ 1 comment… add one }

  • Jose July 4, 2020, 2:21 pm

    You are right and at the same time you are not?
    Remember serviceof.com I had this domain and you for three years always said it is very bad no one will buy it from you, in the end I dropped it after 60 days it was sold for $ 3500
    I listened to you and I always listen to you because from you I learned what you taught me, we all fail one day or another nobody is perfect.

    I hope you have a very good 4th of July.

    Reply

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