You have to consider paper loss as real loss. There's no logic to say paper loss is no loss. If you made a mistake you have to either make a decision to face your mistake, learn from it and make better choice next time. You can take whatever that's left and put the money in some real quality stock to really make money or would you rather let it continue to make more potential losses? I would choose the former.
There are 2 kinds of investing, Investing in quality stocks aka companies with good track record vs speculative investing.
To be a good investor, you need to have the nose to smell an undervalued stock that has good track record but for some reason its stock price has been beaten up for no good reason. You need to learn how to read earning reports and come to your own conclusion if the current share price is worth going in.
If you're a Investing in quality stocks and you are sure that the price you went in is a good deal, then you should continue to hold because the price will surely go up to its true value because it is what it should worth.
Let me give you an example, its just like shopping. If you went to a car dealer and they're selling a ferrari at 50% discount because the car dealer maybe closing the business and trying to clear stock. You will likely want to buy it because you know its value and its worth the money. You can even sell it off and earn a profit perhaps.
So its the same if you buy a good stock, if you know its currently at a discount, you can buy and leave it. If it drops more you can accumulate more because you know its true value and the current stock price movement is just a temporary thing.
But if you are doing a speculative investment, it's better to admit that you made a mistake, sell the stock, minimize losses and learn from it.
It doesn't mean you should not speculate. You should understand your appetite for risks. If you're a conservative person, stay away from speculative investment. If you can take risk, keep your speculative investment small, use only money that you don't mind losing.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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