Is it wise to hold on to stock that has plummeted and then stabilized?How do I simulate a trailing limit orderHow are investment funding valued when invested in a company before it goes public?May I Invest as a non accredited investor?What is it about company performance that causes the perceived value of its stock to rise?Company revenue increased however stock price did notCould ignoring sunk costs be used to make an investment look more attractive when it's really not?Historically, has stock value gone up in relation to corporate tax cuts? To what extent?Why can't we all agree to create a self-fulfilling prophecy with regards to the stock market?To what extent can dividends be seen as an informed and careful conclusion about the company's long term ability to at least maintain it?ESPP--any reason not to go all in?
If a centaur druid Wild Shapes into a Giant Elk, do their Charge features stack?
Patience, young "Padovan"
Denied boarding due to overcrowding, Sparpreis ticket. What are my rights?
How to deal with fear of taking dependencies
What causes the sudden spool-up sound from an F-16 when enabling afterburner?
Are objects structures and/or vice versa?
Could Giant Ground Sloths have been a good pack animal for the ancient Mayans?
Is domain driven design an anti-SQL pattern?
Crop image to path created in TikZ?
I see my dog run
Is this food a bread or a loaf?
Why airport relocation isn't done gradually?
Are white and non-white police officers equally likely to kill black suspects?
Is it wise to focus on putting odd beats on left when playing double bass drums?
Shall I use personal or official e-mail account when registering to external websites for work purpose?
Landlord wants to switch my lease to a "Land contract" to "get back at the city"
Can a planet have a different gravitational pull depending on its location in orbit around its sun?
Manga about a female worker who got dragged into another world together with this high school girl and she was just told she's not needed anymore
Is there a familial term for apples and pears?
Is there a way to make member function NOT callable from constructor?
Unbreakable Formation vs. Cry of the Carnarium
Why was the "bread communication" in the arena of Catching Fire left out in the movie?
Where else does the Shulchan Aruch quote an authority by name?
Why doesn't a const reference extend the life of a temporary object passed via a function?
Is it wise to hold on to stock that has plummeted and then stabilized?
How do I simulate a trailing limit orderHow are investment funding valued when invested in a company before it goes public?May I Invest as a non accredited investor?What is it about company performance that causes the perceived value of its stock to rise?Company revenue increased however stock price did notCould ignoring sunk costs be used to make an investment look more attractive when it's really not?Historically, has stock value gone up in relation to corporate tax cuts? To what extent?Why can't we all agree to create a self-fulfilling prophecy with regards to the stock market?To what extent can dividends be seen as an informed and careful conclusion about the company's long term ability to at least maintain it?ESPP--any reason not to go all in?
.everyoneloves__top-leaderboard:empty,.everyoneloves__mid-leaderboard:empty,.everyoneloves__bot-mid-leaderboard:empty margin-bottom:0;
I own some stock that lost more than half its value. It has now been more or less stable for months, and I'm tempted to get rid of it because I see poor prospects in the future for this line of business.
However, I'm told by others that this is unwise, that this is the worst time to sell -- I should recover the losses!
Isn't this the gambler's fallacy? What stops the stock from going down by another half in the future, again? And again?
The people giving me this advice have no insight at all into this particular stock nor have a particular keen insight into economics in general. However, they present this as if it is obvious fact that everyone should know, that if you have experienced this, then you should wait until it has regained at least some of its value.
What basis would anyone have for this statement? Is it true that statistically, more often than not, a company will recover?
The way I view this, is if I would rather buy or sell stock in the company now. What happened in the past is simply unfortunate (for me), it by itself doesn't have any bearing on the future for this company.
investing
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
add a comment |
I own some stock that lost more than half its value. It has now been more or less stable for months, and I'm tempted to get rid of it because I see poor prospects in the future for this line of business.
However, I'm told by others that this is unwise, that this is the worst time to sell -- I should recover the losses!
Isn't this the gambler's fallacy? What stops the stock from going down by another half in the future, again? And again?
The people giving me this advice have no insight at all into this particular stock nor have a particular keen insight into economics in general. However, they present this as if it is obvious fact that everyone should know, that if you have experienced this, then you should wait until it has regained at least some of its value.
What basis would anyone have for this statement? Is it true that statistically, more often than not, a company will recover?
The way I view this, is if I would rather buy or sell stock in the company now. What happened in the past is simply unfortunate (for me), it by itself doesn't have any bearing on the future for this company.
investing
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
1
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
2
There's your answer.
– jcm
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago
add a comment |
I own some stock that lost more than half its value. It has now been more or less stable for months, and I'm tempted to get rid of it because I see poor prospects in the future for this line of business.
However, I'm told by others that this is unwise, that this is the worst time to sell -- I should recover the losses!
Isn't this the gambler's fallacy? What stops the stock from going down by another half in the future, again? And again?
The people giving me this advice have no insight at all into this particular stock nor have a particular keen insight into economics in general. However, they present this as if it is obvious fact that everyone should know, that if you have experienced this, then you should wait until it has regained at least some of its value.
What basis would anyone have for this statement? Is it true that statistically, more often than not, a company will recover?
The way I view this, is if I would rather buy or sell stock in the company now. What happened in the past is simply unfortunate (for me), it by itself doesn't have any bearing on the future for this company.
investing
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
I own some stock that lost more than half its value. It has now been more or less stable for months, and I'm tempted to get rid of it because I see poor prospects in the future for this line of business.
However, I'm told by others that this is unwise, that this is the worst time to sell -- I should recover the losses!
Isn't this the gambler's fallacy? What stops the stock from going down by another half in the future, again? And again?
The people giving me this advice have no insight at all into this particular stock nor have a particular keen insight into economics in general. However, they present this as if it is obvious fact that everyone should know, that if you have experienced this, then you should wait until it has regained at least some of its value.
What basis would anyone have for this statement? Is it true that statistically, more often than not, a company will recover?
The way I view this, is if I would rather buy or sell stock in the company now. What happened in the past is simply unfortunate (for me), it by itself doesn't have any bearing on the future for this company.
investing
investing
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
edited 5 hours ago
AlphaCentauri
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
asked 5 hours ago
AlphaCentauriAlphaCentauri
1062
1062
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
New contributor
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
AlphaCentauri is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.
1
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
2
There's your answer.
– jcm
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago
add a comment |
1
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
2
There's your answer.
– jcm
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago
1
1
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
2
2
There's your answer.
– jcm
4 hours ago
There's your answer.
– jcm
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago
add a comment |
1 Answer
1
active
oldest
votes
This might be closer to the sunk cost fallacy with a bit of loss aversion thrown in. I know it is hard emotionally to "lock in your losses", but that money is gone and it is a new day. You have an asset that is worth what the stock trades at today and that's what you have to work with.
It is very possible that stock might regain its previous losses, but the fact that you paid more for it doesn't make it any more/less likely to than any other stock.
The key is that you have to pretend that you have the cash value of the stock today and never invested it. If you would buy that stock today, keep it. If you wouldn't trade the same amount of cash for the stock, try something else.
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
add a comment |
Your Answer
StackExchange.ready(function()
var channelOptions =
tags: "".split(" "),
id: "93"
;
initTagRenderer("".split(" "), "".split(" "), channelOptions);
StackExchange.using("externalEditor", function()
// Have to fire editor after snippets, if snippets enabled
if (StackExchange.settings.snippets.snippetsEnabled)
StackExchange.using("snippets", function()
createEditor();
);
else
createEditor();
);
function createEditor()
StackExchange.prepareEditor(
heartbeatType: 'answer',
autoActivateHeartbeat: false,
convertImagesToLinks: true,
noModals: true,
showLowRepImageUploadWarning: true,
reputationToPostImages: 10,
bindNavPrevention: true,
postfix: "",
imageUploader:
brandingHtml: "Powered by u003ca class="icon-imgur-white" href="https://imgur.com/"u003eu003c/au003e",
contentPolicyHtml: "User contributions licensed under u003ca href="https://creativecommons.org/licenses/by-sa/3.0/"u003ecc by-sa 3.0 with attribution requiredu003c/au003e u003ca href="https://stackoverflow.com/legal/content-policy"u003e(content policy)u003c/au003e",
allowUrls: true
,
noCode: true, onDemand: true,
discardSelector: ".discard-answer"
,immediatelyShowMarkdownHelp:true
);
);
AlphaCentauri is a new contributor. Be nice, and check out our Code of Conduct.
Sign up or log in
StackExchange.ready(function ()
StackExchange.helpers.onClickDraftSave('#login-link');
);
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function ()
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmoney.stackexchange.com%2fquestions%2f107547%2fis-it-wise-to-hold-on-to-stock-that-has-plummeted-and-then-stabilized%23new-answer', 'question_page');
);
Post as a guest
Required, but never shown
1 Answer
1
active
oldest
votes
1 Answer
1
active
oldest
votes
active
oldest
votes
active
oldest
votes
This might be closer to the sunk cost fallacy with a bit of loss aversion thrown in. I know it is hard emotionally to "lock in your losses", but that money is gone and it is a new day. You have an asset that is worth what the stock trades at today and that's what you have to work with.
It is very possible that stock might regain its previous losses, but the fact that you paid more for it doesn't make it any more/less likely to than any other stock.
The key is that you have to pretend that you have the cash value of the stock today and never invested it. If you would buy that stock today, keep it. If you wouldn't trade the same amount of cash for the stock, try something else.
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
add a comment |
This might be closer to the sunk cost fallacy with a bit of loss aversion thrown in. I know it is hard emotionally to "lock in your losses", but that money is gone and it is a new day. You have an asset that is worth what the stock trades at today and that's what you have to work with.
It is very possible that stock might regain its previous losses, but the fact that you paid more for it doesn't make it any more/less likely to than any other stock.
The key is that you have to pretend that you have the cash value of the stock today and never invested it. If you would buy that stock today, keep it. If you wouldn't trade the same amount of cash for the stock, try something else.
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
add a comment |
This might be closer to the sunk cost fallacy with a bit of loss aversion thrown in. I know it is hard emotionally to "lock in your losses", but that money is gone and it is a new day. You have an asset that is worth what the stock trades at today and that's what you have to work with.
It is very possible that stock might regain its previous losses, but the fact that you paid more for it doesn't make it any more/less likely to than any other stock.
The key is that you have to pretend that you have the cash value of the stock today and never invested it. If you would buy that stock today, keep it. If you wouldn't trade the same amount of cash for the stock, try something else.
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
This might be closer to the sunk cost fallacy with a bit of loss aversion thrown in. I know it is hard emotionally to "lock in your losses", but that money is gone and it is a new day. You have an asset that is worth what the stock trades at today and that's what you have to work with.
It is very possible that stock might regain its previous losses, but the fact that you paid more for it doesn't make it any more/less likely to than any other stock.
The key is that you have to pretend that you have the cash value of the stock today and never invested it. If you would buy that stock today, keep it. If you wouldn't trade the same amount of cash for the stock, try something else.
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
answered 2 hours ago
JohnFx♦JohnFx
35.7k984187
35.7k984187
add a comment |
add a comment |
AlphaCentauri is a new contributor. Be nice, and check out our Code of Conduct.
AlphaCentauri is a new contributor. Be nice, and check out our Code of Conduct.
AlphaCentauri is a new contributor. Be nice, and check out our Code of Conduct.
AlphaCentauri is a new contributor. Be nice, and check out our Code of Conduct.
Thanks for contributing an answer to Personal Finance & Money Stack Exchange!
- Please be sure to answer the question. Provide details and share your research!
But avoid …
- Asking for help, clarification, or responding to other answers.
- Making statements based on opinion; back them up with references or personal experience.
To learn more, see our tips on writing great answers.
Sign up or log in
StackExchange.ready(function ()
StackExchange.helpers.onClickDraftSave('#login-link');
);
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function ()
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmoney.stackexchange.com%2fquestions%2f107547%2fis-it-wise-to-hold-on-to-stock-that-has-plummeted-and-then-stabilized%23new-answer', 'question_page');
);
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function ()
StackExchange.helpers.onClickDraftSave('#login-link');
);
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function ()
StackExchange.helpers.onClickDraftSave('#login-link');
);
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function ()
StackExchange.helpers.onClickDraftSave('#login-link');
);
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
1
If you didn't own any of this stock, would you buy some now?
– jcm
5 hours ago
@jcm No, and that was my point.
– AlphaCentauri
5 hours ago
2
There's your answer.
– jcm
4 hours ago
As you stated, (1) nothing stops the stock from going down by another half in the future and (2) what happened in the past has no bearing on the future for this company. Your choice is to continue Buy & Hope or accept defeat. Regardless of which you choose, the future is unknown. Another choice is that if you believe (hope?) that the stock has stabilized and if it offers options, sell some OTM covered calls and receive some income while waiting. It will likely be a locked in loss but a smaller one. Again, no guarantees.
– Bob Baerker
4 hours ago