If I own a stock that has fallen 50%, what information should I research to evaluate whether I should sell or hold?

Chris Kacher, My personal track record has been verified by big-four auditor KPMG at +18,241

You should never had held that long. If it unfortunately gapped 50% lower overnight not giving you a chance to sell sooner, most all stocks will give price/volume clues ahead of the major gap down allowing you to sell. In my 25+ trading career, I have only had one unfortunate gap down situation where the stock hit new highs, then gapped lower by about 21% the next day. In other words, such an occurrence is extremely rare.

In terms of sitting with a stock that has fallen 50%, unless the price/volume action has been constructive suggesting higher prices, you have no business sitting in the position. You might as well just go to Vegas and put it all on black 18 at the routlette table. Barring any major market correction taking place, most stocks down that much are down there for good reason. At Virtue of Selfish Investing, we find our 25+ years of investment success always adds up to focusing on those trades where the profit potential on a time-weighted basis is strong.

We have been running our site since 2010, thus have more than 6 years of archived reports that are available to non-members here: Stock market timing reports

Feel free to contact me directly at chris@mokainvestors.com though most find the answers they need in our FAQ section.

I am the co-founder of Virtue of Selfish Investing, LLC and MoKa Investors, LLC. We run the website www.virtueofselfishinvesting.com.

 

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