One of the most frequent questions I get from readers is what to do when a stock’s price falls 30% to 50% and whether they should buy more, continue to hold, or sell to cut their losses. Tough choice… which is why it’s important to have a systematic and logical investment process to evaluate your investments if/when such an event happens.
So if you’re faced with this dilemma and you’re not sure what to next, here’s the three-step process I always use when one of my stock has fallen by 30% to 50%, or by any significant amount for that matter.