I bought a stock for $25 a share. It's now worth about $18, and it's been in this range for the past 2 years. Is there anything I can do, other than selling it and writing off the $3k loss?
2007-10-26 07:31:15 · 10 answers · asked by D 1 in Business & Finance ➔ Investing
You can sell a call option on the stock. For example let's say you own 1,000 shares of xyz stock worth $100.00 per share, you can sell a call option for Jan.08 110.for let's say $3.00 ,option contracts sell in blocks of 100 so you could get $300.00 per contract and you would sell 10 contracts, that's $3,000. you can put in your pocket. Now if the stock stays the same, you still keep the premium, if it goes to $110.00 then you will be asked to sell the stock at $110. and make that extra $10.00 and still keep your $3k profit. The only draw back is that you can't sell the stock before expiration unless you buy back the options or if the stock goes up higher than 110 you lose the upside profit. But that doesn't happen very often. To find out how much your options are going for look up your stock and go under option chains, you can get that info on yahoo finance. Good luck
2007-10-26 09:33:43 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Investing in single stocks can cost you quite a chunk, huh? Are you gonna be hurt by losing the $3000.00 or is it more of an ego thing? Why is the stock down? Why did you buy it? I don't buy single stocks without a very specific goal. Once the goal is satisfied, I sell. If the stock was a poor choice despite my "due diligence," well, those things happen. You'll get over it.
Write off the 3K.
Then, since you have to ask this question, stop investing in single stocks and go find yourself a good family of funds. Try Vanguard or Fidelity. Both offer easy to get into, very low cost to stay in, and good producing no load funds.
2007-10-26 07:45:48 · answer #2 · answered by David in Madison 4 · 0⤊ 0⤋
Well, look at your opportunity cost. You have about $7700 tied up in a stock that is not performing. Lets say that it keeps where it is at for the next two years. If you sell and use that money to get into a stock that makes about 8% each year for the next two years then you will make over $1200. If you keep the stock then you will make nothing. It sounds like you should move on from this little money anchor. Sell and don't look back. The $3000 will hurt but the longer you hold the stock, the more money you lose out on making.
2007-10-26 07:37:35 · answer #3 · answered by A.Mercer 7 · 1⤊ 0⤋
Theres a pretty easy way to make a decision on the stock:
Ask yourself, would I buy shares of this stock at $18 now if I had the money.
If the answer is yes, hold onto the stock.
If the answer is no, sell the stock, take the loss, and invest in something that the answer is yes to.
2007-10-26 07:42:27 · answer #4 · answered by sbledsoe37 2 · 1⤊ 0⤋
Depends on what you think of the stock. Too often people aren't willing to cut their losses. To put it another way, if I gave you $7700 (or whatever the stock is worth now) in cash, would you buy the stock. That is the way you should think about it.
You have a few choices
1) Sell and buy another stock
2) Hold your current stock
3) If you really like the stock buy more.
If you are unwilling to do 3, you should sell and buy a different stock, or better, a mutual fund.
2007-10-26 07:37:35 · answer #5 · answered by nystom 2 · 1⤊ 0⤋
You should have sold long time ago. It may now be ready to move up but without the symbol I wouldn't be able to tell.
But generally speaking, there is no need to ever hold on to a loser when there are hundreds of good stocks moving up every day.
2007-10-26 08:11:50 · answer #6 · answered by Anonymous · 0⤊ 0⤋
search around and see if anything is going on with the stock....do people/you think it is going back up? or further down?
you can sell calls against the stock and make back some of the investment.remember, if they exercise the call, the stock is gone...............back to the news about the stock,,,,,,,,,if it is favorable, buy some more and average your price down................
2007-10-26 07:48:37 · answer #7 · answered by richard t 7 · 0⤊ 0⤋
I always keep my winners and sell my losing stocks over 10-15%. If you wouldn't buy it again today sell it and by some OXY, HES, ATVI, ERTS, WU, HCSG undervalued winners that will make your loss back
2007-10-26 09:34:49 · answer #8 · answered by crim 3 · 0⤊ 0⤋
You can sell your stock and hire me to pick a stock currently at $18.00 that could go as high as $25 in a year or less. (I am a Portfolio Manager)
2007-10-26 09:23:26 · answer #9 · answered by Anonymous · 0⤊ 1⤋
Bite the bullet & sell its an expensive lesson but hold cash & wait for an opportunity to arise in a blue chip company or put it into a trust .....I just invested my pension in Ruffer investment trust a long term hold that wont get you rich quick but you wont lose your shirt either.
2007-10-26 09:14:13 · answer #10 · answered by Anonymous · 0⤊ 0⤋