Diamond H -- At first, I thought (I'm paranoid) that your post was not just addressed to me, but aimed at me. After all, I had confessed that I was still hanging on to Tidewater after a 30% drop (I'm hanging on to ESV as well). The thrust of the piece you posted is that it is silly to hang on to a loser.
However, from other posts you have made, I gather that you too are hanging on.
So, the question is: how to tell when a stock is truly a loser?
I have made it a rule to sell any stock that falls by more than 12% from the purchase price. However, most of the ones I sold using that rule are doing better now than the ones I kept!
I made an exception in the case of my oil service stocks because the price decline was due solely to the collapsing price of oil. They were, and remain, good companies, and are in good financial shape. They have not done anything "wrong," and normally, one would expect the price to bounce back sooner or later (preferably sooner).
In other words: as companies, they are not losers. BUT -- and this is the big question -- is the SECTOR a loser? And if so, for how long? I keep on debating with myself about whether to call in the chips or not, whether to go on to fairer pastures or wait here until the cows come home. What is the "realistic" thing to do? Thoughts, anyone? |
