4 ms·
> Everyday I'm holding onto the shares is the same as if I made the decision to buy that many shares on that day This is a great way to think about holding inv
by ganonm 10y ago
> Everyday I'm holding onto the shares is the same as if I made the decision to buy that many shares on that day
This is a great way to think about holding investments. I remember using this argument to try and convince a family member that they should sell what I considered to be a bad investment. I phrased it as 'If you were forced to sell your shares right now would you use the money from the sale to immediately buy back your shares?'. He responded that no, he wouldn't. Obviously this ignores brokerage fees, but it is a useful thought experiment nonetheless.
- Cookingboy 10y agoYep, and it's a great way to debunk stuff like the Sunken Cost (I've put in so much already!) fallacy.
- trevyn 10y agoIgnoring tax implications is a much, much bigger problem for your argument than ignoring brokerage fees.
- sokoloff 10y agoIndeed. Even execution slippage is greater than brokerage fees for a reasonable sized round-trip trade at a discount broker.
- floatrock 10y agoSure, the real world inhabited by the pro's is complicated, but the point is when we're first learning the fundamentals, we assume an idealized frictionless plane.
- olalonde 10y ago> This is a great way to think about holding investments. Unless you believe in the efficient market hypothesis...