Don’t Panic When You Lose Money

Your stocks are going down dramatically! 10,20,30% losses in one day. What should you do?

1) Check whether the effect is direct or indirect. If a report comes out that the economy is performing worse than expected. Or some other stocks are dragging down the entire sector including yours, or there is some overrreaction after earnings. Then nothing has fundamentally changed and you should be disciplined and calm.

2) If something fundamentally has changed, such as the company you're investing in, is shutting down 10,000 stores or firing 20,000 people, then something fundamentally has changed and you might need to redo your analysis.

Never panic sell everything at once using a market order. This will huge to more losses than necessary!