【What Should You Do If a Stock You Bought Falls?】

【What Should You Do If a Stock You Bought Falls?】CLEC Club

Writing date: Jan 11, 2019

Students or online friends sometimes ask me what they should do when an individual stock they own has fallen by half. Sell it? Or keep holding?

Many people buy an individual stock without knowing why. When the stock falls, they do not know what to do.

Then you have to ask: what were your original reasons for buying this company?

Also, I can research the individual stock an investor asks about and whether it should continue to be held or should be sold. I can research that stock, but if I give my recommendation, I have to keep observing and reviewing it, because I know that giving someone advice is not just one sentence. It is a long-term responsibility. If more than a dozen people have the same question and I give all of them advice, I may not be able to bear that.

So my suggestion is this: when you first bought this stock, did you study it to the point of pledging yourself to it, making up your mind to hold it forever for your whole life? (You should not fall in love with a stock; you should be willing to pledge yourself to it before you can hold it.)

If you have made up your mind to hold it for your whole life, market volatility should not change your determination.

If you are not willing to be with this stock for life after life, then you should not buy it.

So the final question to ask yourself is: at the current stock price, would you want to buy and hold this stock, and hold it for life after life? Then you can answer your own question.