Could be staring a hoping and a praying they would turn profitable. I think he is likely a young person. But anyway interaction is sometimes a bit amusing.
We operate under an additional constraint, typical of any profession: There are loss limits and we consider paper losses to be real losses. All businesses run on cash flow. Opportunity Cost is also reflected as the time value of money, since most businesses borrow a little for day to day costs. They negotiate their payment points based on this, and the credit risk of the customer. The fact that you believe in holding losers and sometimes averaging down means you either have no financial constraints, or aren't using real money.
Why would you consider paper losses losses? Do you consider paper gains gains? They are meaningless. As far as holding losers there is no such thing ..would you sell your house because it dropped 50k in price? That's just plain dumb. The more I hear traders talk the more I understand why most of them don't make any money.
I would sell my house if it looked like it would continue to drop in value. A lot of small rural communities in BC are losing their main industries, sawmill and mining, you get what the market will pay. What you paid for the house doesn't matter. As far as , "locking in a loss" is a meaningless concept, although it seems to be quite widespread. A loss exists or it does not. Pretending that it does not come into being until it is "crystalized" is equivalent to putting one's fingers in one's ears and singing: "La, la, la! I can't hear you!" The analogy that comes to my mind is driving a car with defective brakes since, after all, the problem has not been caught by a formal safety inspection yet. If the argument is that a security, on which a loss has been incurred, might yet increase in value, the counter is to ask whether it is more likely to go up than another security. The relevant consideration is not the previous loss, but rather the potential for future gains. In other words, a gain is a gain is a gain, regardless of past history. The market has no memory, nor does it have a sense of fairness, whereby it makes up for past losses by favoring historically losing securities.
If the market doesn't have a memory...how do you expain trading ranges and support and resistance levels? Also, stocks recover unless going bankrupt.
That would have originally been a C... I usually start with the lowest dip at the highest degree, and start labelling WXY or ABC (doesn't really matter) and then fill in the subwaves. You are looking for symmentry. This Y is too stunted...they are extended more. Here is another version. At a lower degree, abc can become an ABC....and at a higher degree an ABC can become an abc. You are basically waiting for wave (5) to develop...every time it fails you label it an abc. It really doesn't matter how you label it as they are all showing the same thing. btw usually the (4) if .38 or .50 of wave (3), if it breaks .618 then we are likely in the (3) wave of a new downtrend...but I would expect that to happen more quickly, not in an extended correction like we are having.