It seems like everyone sells their shares when it falls under what they paid for but I want to know what happens when you keep your shares forever and never sell no matter what even when the stock price is falling?
2007-09-07 07:22:25 · 6 answers · asked by ? 3 in Business & Finance ➔ Investing
Nothing happens. It's just a piece of paper till you cash in. Don't do it now. Hold on to it for quite awhile. It'll go back up. When people see the markets fall as they are now, they panic and sell. In effect, they buy high and sell low which is the opposite of what you should do. You buy low and sell high. Hang in there. Time is on your side.
2007-09-07 07:32:37 · answer #1 · answered by Irish 7 · 2⤊ 0⤋
You are losing value...your holdings are worth less if you sell... but only if you sell. There are many reasons to hold in that case...most moves are temporary...bad news in that " sector", or a bad quarterly report from the company, maybe competition increased or profit margins fell ( whatever supplies your company needs to " do business" just got more expensive.....
You now have to try to figure out " the future"...is this situation temporary? Maybe the whole market has dropped? ...or will the situation get worse...let's face it : airlines are NEVER going to get cheap fuel again.... Mattel toys will take too long to recover from all these recalls...mortgage companies have shot themselves in the foot...sooooo, sometimes you take the loss....other times you hold...in a very rare occurence, you even buy a little more at the cheaper price..( only if you have extreme confidence that this set-back is from some mis-directed bad publicity, or due to an extremely warm winter, something that you KNOW is going to change..( it better ! you're betting on it! 0
Don't hold just because you " love" the stock or company ...take a long hard look at the situation: do people still want what this company is making or selling? Things change...buggy whips were a profitable business at one time... but even then people went to the drug store and bought soap and cough drops...( get the picture?)
Look at your company is it selling buggy- whips...or cough drops.
2007-09-07 09:03:08 · answer #2 · answered by jebediabartlett 6 · 1⤊ 0⤋
Your stock is only worth what the current price reflects. Those who sell don't understand or can not use leverage, options. If a person holds onto their underlying position through thick and thin, again their investment follows the trend but they have the benefits of dividends or possibility of a stock split.
2007-09-07 15:25:00 · answer #3 · answered by Barney 6 · 0⤊ 0⤋
You would take what is called a "paper loss," that is, your assets are now worth less than they were, but you haven't "locked in" the loss by selling out of your stock.
Stocks may come back after they drop down, but be warned: they have a tendency to go down much faster than they go up. It may take quite a while for your stock to recover all its losses...if it ever does (there's no guarantee it'll come back).
2007-09-07 08:25:04 · answer #4 · answered by andrewtrades 2 · 1⤊ 0⤋
the proportion fee could pass down via with regard to the comparable proportion because of the fact the drop in gross revenues. If gross revenues is going down 20%, the proportion fee could too. That way it keeps the comparable PE (fee/income ration). maximum folk do no longer even pay interest to the dividends.
2016-10-10 03:38:16 · answer #5 · answered by Anonymous · 0⤊ 0⤋
There is such a thing as the company closing its doors because it does not make any money and the stock becomes worthless paper.
2007-09-07 07:30:49 · answer #6 · answered by Anonymous · 0⤊ 0⤋