Chances are pretty good that over the last few years you've received shares in a spin-off. My advice: Don't be quick to sell them.

I am a big fan of spin-offs for several reasons. First, companies that are spun off from larger companies are forced to hit the ground running since they are now independent companies.

Second, spin-offs are less efficiently priced since many investors do not follow them closely.

Third, buying opportunities are often created due to selling pressures on spin-offs that have nothing to do with the company's underlying fundamentals. For example, managers of index funds are forced to sell spin-offs they receive because the spin-offs are not part of that particular index.

Also, many spin-off companies implement what are called "odd-lot buyback" programs shortly after being spun off. These programs work like this - companies will approach new shareholders in the spin-off and offer to buy back the shares. These offers are generally made to investors holding less than 100 shares. In many cases, especially if the shareholder holds only a few shares, the investor will sell the shares back to the company or on the open market. Consequently, it is not unusual for spin-offs to experience selling pressure early in their lives. However, such selling usually opens the door for a good buying opportunity.