The Stock I Bought Last Year Is Down 40%, and I Still Haven't Sold
"It's a long-term investment, so I'll hold." I've been holding for a year saying that lol. I tried averaging down and just burned through my cash.
Is HODLing the answer, or is cutting losses the answer...
10 answers
I've been in a similar situation. In the end, after I cut my losses, I felt relieved. Of course, it's frustrating when it goes up afterward, haha.
It's really important to set a stop-loss level before you start. Just making a habit of cutting at -10% can keep your account alive. I couldn't stick to that, and I still regret it ㅠ
But what stock is it? It depends completely on that. Giving advice based only on -40% is all nonsense.
Whether cutting losses is the answer or holding on is the answer depends on why that company dropped. If the whole market fell, it's worth holding out, but if its earnings or business structure is broken, it's better to get out quickly. You can't judge just by looking at the stock price.
Well, that's a bit... If you're down 40%, isn't it better to admit you made a bad call and set a rule? If you keep holding on, that's the same as not managing risk at all.
But wait, isn't the reason you bought it the most important thing? If the reason you bought it is gone, you should sell; otherwise, you should hold. Without that, it's just gambling.
Got a source? Asking for advice without even mentioning which stock it is is a bit...
Agreed—I'm still holding the bag from last year too lol. That hits a little too close to home.
Averaging down is genuinely dangerous: you do it with a break-even mentality, your position keeps growing, and your entire account ends up tied up in that one stock. I was stuck like that for three years before I finally managed to escape.
Isn't that old news? These days, people just can't hold out and everyone bails lol