hi all,
i hope you could help me with this situation. a friend of mine, whom i dont see very often has some properties and some money, he is not interested in managing his assets, so he gave it to a friend of his, who he trusts (or trusted), who is an investor. the investor invested it all into the stock market, and he made money. then the crash came, my friend called him when he read the bad news and asked if it isnt better to get out. the investor denied and said it will go up again ... sure ... he trusted him and let it go.
then he is down some 100K and called him again, asked again, if it wouldnt be better to get out. he was denied again, told it would be alright, he has to ride it out, everything will be alright.
then, unfortunately just a few weeks ago, i heard of this situation and i couldnt believe it, i asked if he'd never heard of a stop loss, and who is this investor, who stayed in this trade, ... in short: omg, wtf
i draw the below chart for him and asked him the question i ask myself sometimes (from emotional free trading i believe): if you wouldnt be in that trade, would you still want to be in? would you want to be long here?
the first problem is, im not a professional trader .. yet, so why listen to my advice, besides im his friend.
second, right now he is down 3/4, not his total, but a big chunk of his total, so he is some kind of psychologically invested in this trade, he is not a trader and he doesnt know about any kind of "keep you losses short", ... etc, he is more buy and hold for years.
so i need some professional advice, or better an argument ... in fact a confirmation of my view, that he is not going to break even in the next years, i believe long term the dow will not make it, but i think it could at least pullback to 8800 or 9600.
i told him to get out, reevaluate, digest the loss, start new ... etc, but his "investor-friend" told him to stay in, ride it out, it will be alright, ... now he doesnt know what to do, given contrasting statements from different sides.
in short what can i do? i want to help him, i dont want him to lose all his money, but also i dont want to give him an false advice, to get out now, but maybe it will move all the way back up, and then im the bad man... its difficult. so i ask here, in hope someone could give me an advice or an argument.
thanks in advance
i hope you could help me with this situation. a friend of mine, whom i dont see very often has some properties and some money, he is not interested in managing his assets, so he gave it to a friend of his, who he trusts (or trusted), who is an investor. the investor invested it all into the stock market, and he made money. then the crash came, my friend called him when he read the bad news and asked if it isnt better to get out. the investor denied and said it will go up again ... sure ... he trusted him and let it go.
then he is down some 100K and called him again, asked again, if it wouldnt be better to get out. he was denied again, told it would be alright, he has to ride it out, everything will be alright.
then, unfortunately just a few weeks ago, i heard of this situation and i couldnt believe it, i asked if he'd never heard of a stop loss, and who is this investor, who stayed in this trade, ... in short: omg, wtf
i draw the below chart for him and asked him the question i ask myself sometimes (from emotional free trading i believe): if you wouldnt be in that trade, would you still want to be in? would you want to be long here?
the first problem is, im not a professional trader .. yet, so why listen to my advice, besides im his friend.
second, right now he is down 3/4, not his total, but a big chunk of his total, so he is some kind of psychologically invested in this trade, he is not a trader and he doesnt know about any kind of "keep you losses short", ... etc, he is more buy and hold for years.
so i need some professional advice, or better an argument ... in fact a confirmation of my view, that he is not going to break even in the next years, i believe long term the dow will not make it, but i think it could at least pullback to 8800 or 9600.
i told him to get out, reevaluate, digest the loss, start new ... etc, but his "investor-friend" told him to stay in, ride it out, it will be alright, ... now he doesnt know what to do, given contrasting statements from different sides.
in short what can i do? i want to help him, i dont want him to lose all his money, but also i dont want to give him an false advice, to get out now, but maybe it will move all the way back up, and then im the bad man... its difficult. so i ask here, in hope someone could give me an advice or an argument.
thanks in advance
Invincibility lies in the defence, the possibility of victory in the attack