Values in fall. Sell or hold? Estrategias de Inversión.

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In this article we are going to treat the part most psychological of investment in stock market. Usually arise, when away from the technical analysis of action, we have invested in a value and that does not react as expected at the time of the acquisition. Then arises a question that is...sell or keep the action?

Given this case, investors can only act in three ways, and we cannot say that a decision is more accurate than the other.

If we invest in an action that begins to lose its value, we can only act in the following ways:

1. Quickly sell.

In this case, is responsible for the fear. We know that to a value that is in decline, keep it we could acquire greater losses and more knowing that that same fear it would be felt by other investors, which would also decide to sell their shares resulting in a further decline of the value.

2. Maintaining the value.

In this case, we use patience. We know that the stock market is in a constant movement and that an action may lower its value but within a few weeks, months or years can return to stabilize. In other cases, an investor tends to keep the value for the simple pride does not recognize a loss, since there is no loss of money until the sale of the action with losses do not effective.

3. Maintain and acquire new shares.

Other investors, far from worrying about the fact that a value is down, what they do is to acquire new shares priced even lower than when they bought. In this way, and hoping that the value back to your site, not only will have had no losses, but it will have considerably increased their profits. It may be the factor that is given in this case the ambition (which is not bad).

Now, which of these three strategies is appropriate?

As well we said at the beginning, none of these three strategies is right or wrong, as according to what value should apply one or the other.

To implement the right investment strategy will have to analyse the value, the reason for the decline of the actions (what is the stock market in general or only this company?), the plans for the future with the company, its projects of expansion and new strategic agreements.

We calculate the time that we foresee that the value will take to upload, since if too long, may be best to sell the shares still at a loss but have not stuck your capital.

On the other hand must also look at whether we compensate for the payment of dividends during this time that the value will be stalled.

However, it may be a timely moment which produces the fall in the value or can be the imminent announcement of a serious problem in the company that could lead to bankruptcy. Analyzed these two points, in the first case the ideal strategy would be the number 3 and in the second case, no doubt, the number 1.

Today, I recognize that the investment strategy that more result has given me has been the number three, call it luck, because that blinded by pride, I have sometimes refused to sell at a loss.

Does you strategy utilizarías given a situation similar to the one described?

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