StockFetcher Forums · General Discussion · REALLY BAD ADVICE.<< >>Post Follow-up
6,362 posts
msg #48289
Ignore TheRumpledOne
12/1/2006 1:40:47 PM

Just about everyone tells you to NEVER add to a losing position.

Do not DOUBLE DOWN is what some say.

And they are right but not only for the reasons you think.

Let's say you go long 100 shares AAPL at $92 and it tanks on you all the way down to $91. You are tempted to buy 100 more. That's a mistake! You should buy at least 200 more shares. Here's the reason.

Based on fib retracements, AAPL would have to bounce 50% for you to breakeven. And if you are human, then you probably want a few pennies more to cover you brokerage fees. And AAPL will probably stall right at $91.50 and reverse on you again.

But if you bought 200 more shares at $91 your average cost would be $91.33 and if AAPL retraces 50%, you can escape with a profit.

But remember the title of this thread: REALLY BAD ADVICE. I am NOT telling you to do this.

This week, I posted some rules I found on the net and the first rule was to NEVER ADD TO A LOSING POSITION, NEVER. The last rule was to know when you can break a rule. And HOW you break the rule is just as important as when.


Couldn't resist...LOL!

StockFetcher Forums · General Discussion · REALLY BAD ADVICE.<< >>Post Follow-up

*** Disclaimer *** does not endorse or suggest any of the securities which are returned in any of the searches or filters. They are provided purely for informational and research purposes. does not recommend particular securities., Vestyl Software, L.L.C. and involved content providers shall not be liable for any errors or delays in the content, or for any actions taken based on the content.

Copyright 2018 - Vestyl Software L.L.C.Terms of Service | License | Questions or comments? Contact Us
EOD Data sources: DDFPlus & CSI Data Quotes delayed during active market hours. Delay times are at least 15 mins for NASDAQ, 20 mins for NYSE and Amex. Delayed intraday data provided by DDFPlus