Your Portfolio: For Better or Worse
By: Jason Cunningham
Some people are married to their portfolio.
They have bought certain securities, and cannot let go, even though the company
may have filed for bankruptcy. These individual investors keep the faith
that these stocks will make a comeback.
You have heard the saying "it is going to
comeback." People are referring to their stock that may appear to be on life support.
Either the traded security has been tarnished by "corporate scandal or maybe its
true fundamentals have caught up with it. Sure it is possible, for the stock to make
it back, to the levels you bought it at. Yet it may be harder for the security,
which does not have a history of positive earning.
Sure it is easy to hold onto ABC stock, and then
watch it of the sudden drop. It may cause you to panic just a bit,
but not enough to sell it. You can stop looking at that security, over
a period of time, however you cannot ignore the newspaper's headlines. Then
it hits you, that ABC stock is trading at $1, a share. Just five months ago,
ABC security was $52, a share. The stock has dropped so low, it may seem
embarrassing to you, that you did not have the foresight to sell.
Unless your whole portfolio is junked with
securities that have you in a doldrums, then do not worry. People do need to
understand, yes, selling the stock locks in your loss, but sometimes it better to
move on. If your significant other leaves you, just move on. Do not have
sentimental value, when it comes to investing, you may get your feelings hurt.
Invest for a specific purpose. To take money and invest it, in the hope over a
course of time, it will have a positive return, to help you retire or something.