Know When to Fold

The most expensive words in investing: "I should at least get my money back." When a stock drops 50%, it must double just to break even.

The most expensive words in investing: "I already invested this much; I should at least get my money back."

Most investors don't lose money because of bad picks — they lose because they refuse to sell losing positions.

When a stock drops 10%, it needs to rise 11% to recover. When it falls 50%, it must double just to get even. The math works against you the longer you hold a losing position.

Even the world's best hedge funds are right only around 48% of the time. Their edge isn't luck — it's discipline and risk management. They play the game like great poker players: don't chase every hand, fold quickly when odds turn bad, stay long enough to win when probabilities align.

Cutting a losing position isn't a failure of research — it's a strategic fold that protects your chips for the next round.