Fear of missing out is a feeling that builds over time. Fear of lower prices happens in the blink of an eye.
It’s incredible how quickly the tide can come out on some of the most beloved stocks. Things that have done nothing but go up can have their gains vanish before investors know what hit them.
There is serious carnage out there in some corners of the market. For example, Lemonade, Plug Power, and Virgin Galactic are all down more than 60% from their recent peaks.
Everyone thinks they can get out while the music’s still playing, but most people don’t have a plan in place for when it stops.
If you’re riding a big winner, you need to have a game plan. Even if the plan is to hold, fine, that’s a plan. But you can’t have success when you’re stock is cut in half and you’re not sure whether to sell it all or buy some more.
These moves happen faster than our ability to process them, so you need to know what you’re going to do before they happen, not after.