Lock In Profits

You bought the stock at $32 a share. It ballooned to $44, and now you're nervous. At $32, you loved it; up here...eh, not so much.

So you just sell and lock in your profits. You bank $12 a share in gains, and the love affair with this run is over. You could have shorted the stock when it was up (See: Shorting Against the Box.) You could have bought puts on it. Or sold calls to others to buy the stock, locking in some profits, or at least starting to realize them by selling someone else the right to buy the stock at $44 any time in the next 3 months for $2 a share. Something like that, anyway.

And yes, you'll pay tax when you transact. Like the Iceman, the Taxman always cometh.