Read? Bear market is here. Let's accumulate more by average down?
Let me repeat it again. If you are small retail investor like me; then must learn to know the big difference between Average In and Average Down in term of risks control and portfolio management.
Average down
How do you know you are averaging down and not averaging in?
You must ask yourself these two question:
(1) Did plan for this level of capital into your beloved stock? e.g. 20 or 30% of your capital
(2) Did you bought more of it due to its falling stock price since it has become cheaper, more attractive and more under-valued?
If your answer is (1); then you are Averaging In.
If your answer is (2); then you are Averaging Down.
When you are averaging down, you are actually taking more risks than initially expected. You are thinking of profits ahead of risks. As small retail investors, most ......
