Eli5: with stocks going down why would someone hold and buy more on the way down (average down) and not just sell now and buy again when the stock bottoms out?
In: Mathematics
How do you know exactly when the stocks have bottomed out?
Hint: you don’t unless they are already coming back up again, at which point you’ve missed some gains.
Also, sometimes, you “know” what the price should be and you understand that this might only be a temporary drop so either way, you’ll make some gain.
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