When to Buy or Sell Stock Update Aug 17 2026

My father was an unusual investor with unusual tactics. He would read some investing book somewhere and fall hook, line and sinker into the story. His big one was buying silver in the late 1970’s. Silver had sat around four bucks an ounce for seemingly forever and the book he was reading blew the usual horns that hot investor books blow.

Silver was in short supply. The mega-banks were reportedly heavily “shorting” it (selling silver to bring and keep the price suppressed). It was about to explode in price touted the book and would go up by many multiples.

Dad bought thousands of dollars’ worth and even though it languished, he kept buying more. When the price finally did move, he bought more and more and his profits doubled, then tripled, then quadrupled. He amassed many millions from a few hundred thousand and still kept buying.

However much me made, his eyes kept getting bigger and used the silver he owned as leverage to buy even more.
I don’t recall how many ounces he amassed or how many millions he had made, but he never sold nary an ounce.

To make a long story short, the folks at the big banks who were on the losing side of the trade convinced the FED that the rise was something akin to an unnatural act and the exchanges that traded the stuff were instructed to act.

Or so the story goes.

In any case, through more than a handful of questionable and rumored to be illegal acts by the “big boys”, silver came crashing down and my father’s money vaporized right along with it.

The moral of the story here is no investment is without risk, and not selling at least some of one’s investing winners is often a recipe for disaster.

In my experience, investors may frequently err on the side of buying their way out of good times as well bad times.

What I mean by this is I often see investors buying more of their losing stocks, averaging the price of their shares by buying more at lower prices.

Interestingly enough, they will use the same strategy on their winning stocks. As their stocks go up and they see more profits, they will also buy more shares in this direction as well.

Think about that one for a minute. The same strategy used for losing stocks is also used for winning stocks.

Sounds counterintuitive, doesn’t it?

And in my opinion, with few exceptions, makes little sense.

The two most descriptive and, in my opinion, dangerous words in the investing mind is fear and greed.

Although fear generates the selling act, the buying of both losing and winning stocks is based almost exclusively on greed.

My dad’s downfall was greed. Whatever he made, it was never enough. When he reached a million, he imagined two million. When he reached two million, he imagined five. And so on and so forth.

He probably could have got to 100 million and still would have set his sights on many millions more.

On the flip side, buying more of a losing stock is also driven by the same emotion. Belief in a stock is not negated by a falling price. Instead, the belief remains even more so. The allure of buying more stock at an even cheaper price activates the calculator of the mind and the profit possibilities becomes even more grandeur.

Many investors know of whence I speak and may, even now, resist the lesson that many a pro trader knows all too well.

Don’t chase your losers and take some profits on your winners.

Doing the flip side of that is often an expensive and painful lesson.

“Watching the markets so you don’t have to”

(end)    

(As mentioned, please use the below disclaimer exactly) THANKS   (Regulations)   This article expresses the opinion of Marc Cuniberti and is not meant as investment advice, or a recommendation to buy or sell any securities, nor represents the opinion of any bank, investment firm or RIA, nor this media outlet, its staff, members or underwriters. Mr. Cuniberti holds a B.A. in Economics with honors, 1979, and California Insurance License #0L34249 His insurance agency is BAP INC. insurance services.  Email: news@moneymanagementradio.com.