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[THREAD] There is a significant difference between: Losing money and the value of your investments going down.
Misunderstanding this can cause you stress, anxiety and affect your sanity
Misunderstanding this can cause you stress, anxiety and affect your sanity
Don't forget, that markets move in cycles. There will be business and economic expansions & declines. Markets also move because of global events i.e. COVID
Earlier this year all the major market indices took big hits and dropped significantly
Earlier this year all the major market indices took big hits and dropped significantly
For the investors who sold out of their positions, they took a loss. This means you cashed out of your unit trust or ETF and moved into cash or money market.
For the investors who stayed the course, they saw the value of their investments fall but didn't actually lose money and
For the investors who stayed the course, they saw the value of their investments fall but didn't actually lose money and
for the most part, have recovered and are now up for the year now.
Losing money = selling your positions or investments when they are down
Not selling = the investment value may be down, but you haven't actually realized a loss
Losses are realized when you sell
Losing money = selling your positions or investments when they are down
Not selling = the investment value may be down, but you haven't actually realized a loss
Losses are realized when you sell
**This doesn't mean you should never sell, but your investments being down doesn't mean that you lost money***
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