Hi everyone. I've been lurking here for a while and enjoy reading many of the discussions on this site. By way of introduction I thought I'd ask a practical question about a trade that I am in the process of murdering.
I'm a newbie with very little capital so I thought I would take it slow. I've spent the last few months reading books, learning the basics of TA and watching the market. I read about many of the mistakes that people make when starting out, then promptly made all of them myself. Eg.,
1. Not using a stop loss.
2. Not following my plan.
3. Believing the hype ("this ones gonna skyrocket when the ann comes out!")
Three days later and i'm sitting on a 35% paper loss.
I am not too worried about the financial cost as it's money I can afford to lose and I expect to take a few beatings along the way, but on a practical note, I guess i have three options -
1. Realise the loss (which may mean selling near the bottom as the stock is now approaching a previous support level).
2. Average down (this seems like throwing good money after bad).
3. Put the shares in the bottom drawer (where bad stocks go to die).
I've deliberately not mentioned the company, as I'm more interested in strategies than discussion of the actual stock.
Apologies for the long-winded post. Thoughts, anyone?