PIETER HUNDERSMARCK OF FLAGSHIP ASSET MANAGEMENT ADVISES WHEN YOU SHOULD ADMIT DEFEAT AND SELL A LOSING SHARE

26 Dec PIETER HUNDERSMARCK OF FLAGSHIP ASSET MANAGEMENT ADVISES WHEN YOU SHOULD ADMIT DEFEAT AND SELL A LOSING SHARE

Pieter Hundersmarck of Flagship Asset Management advises when you should admit defeat and sell a losing share with Wasanga Mehana, standing in for Bruce Whitfield on The Money Show. The disposition effect relates to the tendency of investors to sell assets that have increased in value, while keeping assets that have dropped in value. Such an unlikely phenomenon exists because people dislike losing significantly more than they enjoy winning. Admitting defeat on a share is psychologically difficult. It helps to have a process of reviewing and selling when your original thesis changes.