If I experience losses, they are typically unrealized losses. I have a firm belief that if I do not perceive any fundamental issues with the stock I own, I will not sell, even if the stock price declines significantly. My usual approach is to gradually purchase more shares over time, which I believe can help to average down my cost basis.
For instance, I hold shares in Occidental Petroleum Corporation (OXY). After my initial purchase, the stock price dropped substantially, yet I continued to buy additional shares incrementally. I firmly believe that Occidental is a great company with strong fundamentals, particularly in the energy sector. My confidence in their business model and growth prospects leads me to view any price decline as a potential buying opportunity rather than a reason to panic.
Investing requires a long-term perspective, and I understand that market fluctuations are normal. I am aware that many stocks can experience volatility due to various external factors, such as economic changes, shifts in consumer demand, or geopolitical events. However, I am committed to conducting thorough research and analysis before making investment decisions. By focusing on the underlying value of the company rather than short-term price movements, I am able to remain more composed during market downturns.
Additionally, I have developed a strategy of diversification to mitigate risks associated with individual stocks. While I may hold a concentrated position in certain stocks, I also ensure that my overall portfolio is balanced across various sectors and asset classes. This approach allows me to weather market volatility more effectively and reduce the emotional impact of any one stock's performance.
In conclusion, I am not willing to sell at an unrealized loss because I believe in the potential of the companies I invest in, like Occidental. I view my investments as long-term commitments, and I am confident that, in time, the market will recognize their true value. By staying disciplined and committed to my investment philosophy, I can navigate the ups and downs of the market with a clearer mindset.
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