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inability to cut loss
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singaporegal
Supreme |
16-Jul-2006 15:22
Yells: "Female TA nut" |
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Haha... I have learnt my lesson after taking the bitter pill so many times. Right now, I will not let my losses accumulate until it becomes a big loss. I usually cut loss if the stock price falls to below 3-5% of its last high. Whether I buy a new stock or not depends only one thing - whether it meets my TA requirements for a good buy |
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solomonster
Senior |
16-Jul-2006 15:11
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Agree! But it needs a discipline to make this call. For me, I can only make this decision after some times in the market, forget the loss and fight again for another round. What about this. Will you cut loss (especially on big loss) and buy another stock if you are quite sure that this new stock will go up? |
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singaporegal
Supreme |
16-Jul-2006 13:24
Yells: "Female TA nut" |
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This is a good post. I agree with newmoon. The main reason why I believe I lost a lot of money when I first traded in shares some years back is because I was too proud to admit that I made a wrong decision. I held on to the stock with the blind belief that it will rise again. |
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newmoon
Veteran |
16-Jul-2006 12:40
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From very young our mother has always said to us-son you must not do the wrong thing. So when we are long on stocks and wrong because the market is moving in the other direction we refuse to cut loss because it is difficult to admit that we are wrong. If we hang on to a losing stock we do not have to confess that we are wrong. In a bear market this psychological block sows the seed of disaster. It is better to admit that you are wrong and cut your losses early and live to fight another day. |
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