To The Moon

Given the current market situation, many of your stocks would have suffered significant price declines. If you are a trader and you are still holding onto these stocks, you would be an idiot as you should have had stop losses telling to get out before incurring such huge losses.

But if you are a long-term fundamental investor like me, you would likely be holding onto them. We don't have stop losses. To help me figure out what to do in such situations, I have established a 3 steps check list as shown below.

Hold or Exit Framework

• The first is to check that the intrinsic value is still intact. Prices may have dropped faster than the intrinsic value. Hold if the intrisic value is still higher than the purchased price.
• Step 2 is to check against behaviourial biases, especially confirmation bias. Hold if your analysis is not affected by any biases.
• Finally I check against opportunity costs.

If you have a different approach, I would appreciate if you can share it.

As a long-term fundamental investor, you always face price volatiliy. Rather than ignore them completely, you must check that the price fluctuations is still within your investment bands. The above framework is one tool to do this.