Cut loss, when fundamental has changed or your underlying assumptions made in the company has changed/ no longer valid.
I cut loss, when I invest in PRA, the currency is not undergoing headwinds and 1 MDB is not well publicized, but when I look at the 2 risks which I didn't account for, I cut loss. It would otherwise be a 60% loss and not 10% loss.
Stop loss, is like, to me, a percentage loss u accept and throw in the towel. For example, 10% and I go for capital preservation.
This is the part that is causing some dissonance in my head. If I said price drop 10% and I am wrong, it's like saying market efficient theory is correct and I can "catch a company" near bottom. I dun believe in this.
At hindsight, I am lucky that market rebounded. It's just pure luck, really make no meaning trumpeting that I bought and have my balls with me Blar Blar Blar, because it could easily fall another 10%, the other camp could be trumpeting. The key here is did you execute your plan and did it work well.
I did except for SCI. All my counters bought recently are in the green but the average price might be just above water. Be careful of bloggers who said they made x% in the last 2 months.
If like that also can, I make 20% for STE (AV price is just above water thou) ,
Before market rebound, I already make 20% and 30% for gold and cogent. Given I used the sale money to buy CMPH and STE, I could even lump the gains together and give u an eye popping figure. But my portfolio I think just do ok. Not too sure if it is green or red. But I think u get my point.
So, I could have done better definitely if I have do it differently with SCI.
I could have:
1) stop loss at 10% or/and
2) accumulate at below 2.5
It is not really an analysis problem because drill ships cancellation is within my calculation but not the impact of fall in SCI. So cut loss is not "activated"
Given SCI give only OK dividends I cannot really wait out the loss unlike LMIR and Lee metals
So how? So I improve my balls or should I introduce cut loss?
Or should I let it be?
SMoL, coaching can do online and drinks "ortan"? LOL