All your stock having a selldown despite having good quarter reported. You are on a loss of 5%. What will you do?
B) buy more
D) stop loss at 10%
Hi guys, thanks for all your valuable feedback.
Story of a Sad Duck
Initially holding 5 stocks, sold Valuetronics and make a huge profit. The rest become rotten eggs (7%-17% lost).
Total paper lost now is almost half of my earnings over 2 years.
Reply to @duckie : maybe stick to blue chips ba WWJBH
then the buyer really deserve a bang on the wall !
Reply to @durian_kia : u mean get banged on the wall to raise capital for the loan to buy shares? jump kallang river faster.
Whenever there is a huge drop (3% or more) in a single day, I will check
1) SGX announcements
2) mainstream or social media news
3) social circle
Investing is all about having the conviction that market is wrong and you are right. That itself is an act of arrogance, but you shouldn't be arrogant all the time and check first.
Let's assume company XYZ wrote off a large chunk of receivables that was accumulating for sometimes. Is it something to be worried about? Yes (possible fraud bursting by its seams) Does it change the valuation of this company? If not much, move on. But take note.
Or let's say you bought a telco for its high dividends (bad idea really), and last night it fell 3 percent because it's free cash flow is diminishing, no sign of improving is in sight. It has been 2 years, and management stressed that they gonna keep a dividend at xx cents a year.
I think that is a bad idea.
Lastly, consider an example of a high and mighty growth stock that has report a less than inspiring revenue and net profit growth. If you know your Discounted Cashflow and back calculate it using current market price, and understood that the market is expecting a 15 percent growth every year. Today the company reported a 7 percent growth, and its directors said that they will seek cost control. There are no plans to expand markets, no new products. Days later, insiders start selling the stock.
I hope you be thinking of selling.
You have to be honest with yourself and your valuation. The market is a fugging mean bastard and will test you mentally.
Reply to @lbs : i like the very last words, "the mkt is a fugging mean bastard that test u mentally"
E buy more when it drop 20-25%, else hold.
Down 5% is common to me when I purchase stocks based on FA.
Maybe I suay, my stocks usually in red before they turn green.
But if FA changes and reason for buying is no longer valid, cut and run.
Reply to @Turtle_Investor : Yes, when you in the market long enoùgh, one become more "Street-Wise". That's why I am just a "Street Figther"!!! LOL
Reply to @Turtle_Investor : same w me. my stocks always like to come period first then pregnant...lolx
Probably C if it is a fundamental stock.
Would hold and wait to see if prices go up or down.
Won't average down at a 5% drop, as it is very easily to run out of bullets that way.
But if it a market meltdown and I realize that in time, probably D
If is macro event ( Broad Market ) and you feel is going to go longer, I would sell those non-essential and only retain core holding.
E) read sporeshare Ebook again
Depends on your investment horizon and counter. If it's a dividend counter and you have an investment horizon of 10-20 years, keeping it long term may be a good idea. If it is a speculative counter, cut loss based on Technical Analysis - Stop loss support level when broken.
I have SPH bought like 15 year ago and based on dividend collected so far, think I have already covered my capital, though SPH has been down quite a fair bit recently. Afterall, it has monopoly of the print media and diversifying into the other segment. In other words, it is hard to imagine Singapore without SPH as a mainstream news/print media provider.
Bottom line, investing is all about risk management like anything we do in life, eg: dashing across the road or wait for traffic to be your favour.
It is your choice.
Reply to @bigfoot : why banks now exposure to oil&gas sctor for 21% like wary Ezion bonds not able... . to survive
It's just a minor market corrections, therefore choose B) if it goes to attractively low then buy more at this dip & C) hold since no fundamental change & still intact. Fingers crossed & see the Huat!
Reply to @Jayne27 : I don't know myself. So I can't answer you on that. I judge based from the live price action as well as overall daily market sentiment. Like today, I feel selling is still strong. But only few selective play is up like tech stocks.
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