OT:..That is a tough call for sure & a challenge for any trader. I will oftentimes have a hard rule of 10% even though I have broke it thus far with CYTK. Probably because I know the Sept 3rd catalyst is near. Last year I threw money at a sinking ship in EXEL and lost $50K. I did not do my homework and did not see the pattern of huge volume selling on consecutive days. When I called to inquire and the IR guy would not answer my question that should have been a red flag. I continued to throw money at it because I was in the red and wanted to "avg down." The company did an offering at a huge discount and I got crushed. I posted the trade for everyone and discussed what I had learned. Now I just try to have patience and add with more thought given to why I am adding instead of just trying to average down. Sometimes that means picking up the phone and calling the company. The key is to know what you own and try to make the best decision possible based on the information you have so you don't make common sense errors that can cost you a lot of money. That is just my experience & thought from a bad trade I had.
Message in reply to:
OT: The decision between cutting losses and moving on, or doubling down on a stock is one of the hardest for me to make as a trader. I know traditional wisdom is that if your initial fundamental reason for investing in the stock hasn't changed, then you should average down. However, I've learned from experience that no matter how far a stock has fallen, there is always room for it to fall more. If anyone is interested in sharing, I would be very interested in finding out how you go about making this decision. Thanks everyone.
Sheff's Station...All Aboard...Sign Up Here!
