Posted by JT Yeo > 2015-09-05 21:29 | Report Abuse

1. Protect capital and avoid permanent loss is critical, but this has nothing to do with volatility of the market, as long fundamental remain intact, selling is foolish, unless you found another opportunity than provide lower downside and bigger upside.

2. In the history of sharemarket, the biggest gain and losses normally happens right next to each other, in lumps, meanings the biggest gains are followed by biggest drops. Assume you stay on the sideline during the bear market, and wait until everything clears up, your portfolio return will be way behind the market in the long run. Unless you think you have the best market timing, and i think everyone thinks that they do lol.

3. Looking back the mirror is always easy, you would have convince yourself that had you bought Citigroup stock at $1 at the peak of GFC you would have made 5000% return as of today. But putting yourself at the peak of GFC, when US banks are falling left and right and lehman brothers are collapsing, do you think you would have the balls to buy Citigroup at $1?

4. Cut loss is only possible during the normal market situation, it is like trying to rescue fire because you didn't properly do your homework. Cut loss is possible when there are 'buyers' liquidity', when someone is willing to take the other side of trade. During the height of market panic, who is going to take the other side of your trade, you will cut your loss but at double digits.

Posted by citychew_1886 > 2015-09-05 23:20 | Report Abuse

Hi JT yeo , good explanation for the cut loss theory . i suggest to buy more if a good fundamental stock is falling down like there is no tomorrow. but the concern is you have to prepare some extra cash for this situation . i believe most of us will use all the cash especially during the bull market .

Posted by albatraoz19 > 2015-09-06 17:12 | Report Abuse

Seems like we are about to retest 1500 all over again. This is a good article.

Posted by HITnRUN > 2015-09-06 17:40 | Report Abuse

money concur all, rich becomes richer..thats the point

Posted by Up_down > 2015-09-06 18:11 | Report Abuse

FF has resumed dumping shares on 2nd Sep 15. FF's stakes in KLSE remains more than RM 10.7 billion. This year alone FF has disposed over RM 16 billion worth of shares. Slim chance in generating capital gain given the current weak sentiments. Capital preservation is more important. I'm applying 80/20 rule.

Posted by Kevin Wong > 2015-09-06 20:00 | Report Abuse

Some still stayed fully invested since 2010, some even before 2000!
The question is always whether ordinary investors should stay fully invested at all times for the long term, or try to time major market peaks and troughs.

Good luck everybody, happy and prosperous investing/trading.

Posted by Ntpboon > 2015-09-06 21:13 | Report Abuse

此篇文章写得好。赞！
目前的股市，股民读了若能领会，必获益良多！

股市有涨必有跌，
是牛是熊难分别。
股民心情若纠结，
纪律止损是秘诀。

Posted by ckwan11d > 2015-09-07 07:11 | Report Abuse

Good, as always.

Posted by RicheHo > 2015-09-07 11:27 | Report Abuse

Thanks for all the comments! Appreciate it :)

Posted by Dummy Blackie > 2015-09-11 11:48 | Report Abuse

RicheHo, never know you wrote so many good blogs after your comment to mine... thumbs up...

Posted by RicheHo > 2015-09-11 12:07 | Report Abuse

Hahaha Dummy Blackie, thankiu for your compliment. Sama sama belajar ma :)