Why does wal-street and TV try to convince people not to sell their stock when it's going down?

Question

IF you think about it it makes no sense if a stock is falling it's a waste of time and money when your money could be in one that's going UP!! TV says that too make money you have to hold it though?

Answer 1

The media need to write stories they are not a reasonable place to get investment advice. If a stock ( assuming it is a good long term company ) drops say 25% then there is more chance of it going up than down. If you have already lost 25% then staying put is probably the best way to get it back. Buying a stock that has fallen 25% might be a bargain, imagine soap powder was 25% off, would you buy more or less? Remember that buying a selling stocks isn't easy or everyone would be a millionaire!!

Answer 2

When I  stopped watching the news and the talking heads my protfolio and my performance has done alot better.

If it is a short term stumble, then you may want to hold it.

This is the norm for the talking heads and the Wallstreet gurus.

Stock at $100 and falls to $80, they scream hold it.

It drops to $60 they place a buy on it.

It drops to $40 they place a strong buy

It drops to $20 they finally issue a sell.

Answer 3

Buy LOW, Sell HIGH.

They don't tell you to sell when the market is hitting new highs either.

They rarely tell you sell at any time, at least until it is generally too late.

There are a few that tell you to take some, or half off the table. But few will tell you that.

Answer 4

People have a tendency to buy stocks when the price is high and rising and sell when the price is low and falling. They need to learn that this is not the way to make money.

In the long run, stock prices rise. But it's true that just because prices are low doesn't mean that they are not going a whole lot lower, as we've learned recently. But it's  impossible to time price bottoms and tops.

Answer 5

how much money do you think you will make by buying stocks that are going through the roof, and then selling them when they hit rock bottom?

you should BUY when stocks are cheap, no matter what.  it's the best way to make money.

Answer 6

The best time to BUY a stock is when they're cheap and the price has gone down. The best time to SELL a stock is when they are expensive after the price has gone up. What you suggest sounds backwards and guarantees that you will lose money. Good luck.

Answer 7

Sometimes holding is exactly the right thing to do.  If you've already suffered most of the decline, selling at or near the bottom makes no sense.

Answer 8

It's the difference between a paper loss and a real loss.  Once you sell, you are accepting the loss.  If the investment was a good one in the first place when you bought the stock, then selling during a short term loss is a guaranteed way to lose money.  If it was good, eventually it will appreciate, and you will make the money you expected to make.  Now, if something fundamentally has changed about the company that no longer makes it a good investment, you have a different decision.