"The fundamentals of this stock have changed. Why aren't you cutting your losses?" he asked.
"I'm waiting for a rebound," I replied.
"Waiting for a rebound is the number one reason retail investors lose money," he said. At that moment, I felt he was looking at me the way you'd look at a junk stock that had fallen below every moving average...
The day I couldn't pay my mother's surgery bill, I stopped waiting for a rebound. I cut my losses at the bottom.
Once, I seized the chance to ask him, "When is it okay not to cut your losses?"
He didn't answer right away. After I turned to leave, he spoke behind me:
"First, when the reason you bought is still valid. The earnings haven't changed, the logic hasn't changed, the cycle hasn't changed.
"Second, when you can afford to lose."
So I came to this conclusion:
"Don't buy stocks you can't afford to lose."
"Don't love someone who's out of your league."
Theme: Using trading as a mirror to see ourselves and our love. 1. True strength isn't never making a mistake, but daring to trust again after one. 2. The most profound confession isn't "I love you," but "I haven't set a sell point." 3. Some things take time to prove themselves, like "still holding on to this day."
Another person hurt by Big A