Don't Leave Your Money to the Whales: Stop Selling at a Loss
In the world of investing, especially in the stock and crypto markets, there is a lesson that is always repeated: “Don’t sell at a loss.” But despite the simplicity of this statement, many investors, especially new ones, fall into the trap of selling at a loss under the pressure of emotions and fear. If you are one of them, you need to understand the mechanism of the market and how big forces, such as whales, play a major role in draining individual investors’ money.
Who are the whales?
“Whales” is a term that refers to large investors or institutions that own huge stakes in the markets. They are characterized by the ability to significantly influence price movements. These whales use well-thought-out strategies to steer the markets where they want them to go, often at the expense of smaller investors.
How does loss happen?
1. Fear and Panic: When prices suddenly drop due to massive selling by whales, individual investors panic and start selling to avoid bigger losses.
2. Psychological Impact: Whales use tactics that make the market look like it’s about to crash. The goal? To buy your assets for less than they’re worth.
3. Emotional behavior: Investing requires patience and strategy. But when fear takes over, people make quick and ill-considered decisions.
Why you should not sell at a loss?
1. Volatility is normal: Markets always experience ups and downs.