Common Investor and Trader Blunders

jayc
2021-12-28

Averaging Down or Up

Averaging down on a long position in a blue-chip stock may work for an investor who has a long investment horizon, but it may be fraught with peril for a trader who is trading volatile and riskier securities. Some of the biggest trading losses in history have occurred because a trader kept adding to a losing position, and was eventually forced to cut the entire position when the magnitude of the loss became untenable. Traders also go short more often than conservative investors and tend toward averaging up, because the security is advancing rather than declining. This is an equally risky move that is another common mistake made by a novice trader.

$NASDAQ(.IXIC)$$DJIA(.DJI)$$Meta Platforms, Inc.(FB)$$AMC Entertainment(AMC)$$LCID(LCID)$

免责声明：上述内容仅代表发帖人个人观点，不构成本平台的任何投资建议。

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评论（6）

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  • RudolfKennedy
    ·2021-12-28
    Investment is indeed a science. We need to keep learning.
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  • falleno
    ·2021-12-28
    Great. I hope our retail investors can make money every day.
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  • waipoin
    ·2021-12-28
    Thank you for sharing! Good luck
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  • 躺平躺到地狱了
    ·2021-12-30
    投资的确是一门科学。我们需要不断学习。
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