As I am writing this bitcoin is trading at $950+ at Mt.Gox. So, given that you already have some bitcoins and also some cash to invest, would you buy new bitcoins or sell that you have. Why?
It depends on your price target. I personally think BTC is going to the tens of thousands in the next few years so I see no reason to sell now and even buying at $1k is still relatively cheap.
I think you should cash out at least your initial investment so that even if it crashes to zero (unlikely), you don't feel screwed up. Tradditional Investment wizdom doesn't suggest you to buy at this stage but BTC doesn't seem to belong to tradditional economics...
If you're sitting on substantial gains, I would consider liquidating half, and letting the rest ride for the long term.<p>Simple example. You mined 1,000 a long time ago, and held on to them.<p>Now you're sitting on a million dollars in 'paper' gains. Take half a million out, do whatever makes sense with the gains.<p>If bitcoin goes to $100,000 down the road, you've still got a massive holding worth $50 million. You're not going to miss the other $50 million so much, frankly. You just won the lottery. Most likely bitcoin is either going to soar a lot higher, or crash into some disaster (for any number of reasons).