I agree in general. There is one case I would like to mention and would appreciate your view, Allen too, and others if they feel it has any relevance to the real world.
Take an investor that did buy in at the high side, say $35 a share. they did bet the house or, say $100,000, just to make a case. So here our investor has bet the house and has put his only $100,000 into Wind and now holds some 3,000 shares.
Then he watches the stock go to $18 and sees his $100,000 worth, on paper, a value of $$54,000. now, my numbers are rounded and I understand I am generalizing. He reads the optimist here and 'knows' the stock will be worth many times over this in 3-5 years.
My question to you here is this: should he just sit on his 3,ooo plus shares and wait the three years or:
1. sell them and get the $54,000.
2. Wait the necessary 30 days, hoping the stock does not move up and start to buy back in, hopefully at a per share cost that brings his number of shares up higher than the original 3,000 held, say he now holds 3,100 shares.
3. Then hold until the 3-5 years multi bagger happens, have increased the value of his investment given the crash that caused the price to drop by over half and now reaps the rewards of the 3,100 shares.
Given many statements about how simple it is to just hold and wait, for the person that bought at the high side and looking at the paper loss, the loss was real. Anyway, if they could not buy more, then why not sell, take the loss and buy more shares back with the monies left.
Anyway, would appreciate any feedback.
thanks, Noel |
