“We can’t sell that stock! I love that stock!”
How many times have I heard these words? More than I care to remember. Whether it’s a stock, or a house, or something else, people have a tendency to get overly attached to things that they own.
Maybe it’s our tendency to personalize everything. Or maybe we just get greedy. Whatever the reason, many investors hang onto their purchases long after there’s any economic reason to do so. How else can we explain mutual funds that charge 3% in fees sticking around for years and years?
When it comes to managing money, emotions are your enemy. While you need to care deeply about what you’re doing, any stock won’t know that you own it. Whatever it is in your life you’re attracted to, you should never fall in love with anything that doesn’t love you back.
Douglas R. Tengdin, CFA
Chief Investment Officer
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