Because they don’t have a trading or business plan. They bought a stock with the hopes and dreams that the stock will go up. If they had written a business plan and stickin to it, they would have sold out with a marginal loss which would have freed up funds to use in other opportunities.
Many people watch crude oil and crude oil is an influencer but /CL is not the only influence. GUSH is an ETF consisting of actual assets in the form of ownership in OIL production companies. GUSH is also influenced by the overall stock market. If you track SPY, QQQ and /CL you can see how they work in unison. For example, the market spiked at 14:30 yesterday caused an up-rush in GUSH (and many other stocks) as well at that moment.
With that said, oil could stay put and GUSH could still do well if there is a demand for those companies’ products and services. Unfortunately those companies sell OIL and there is no demand for oil at this moment.
Holding is a smart move if your business plan tells you to hold in this situation. My business plan says to take losses at a certain point no matter what. I took a loss on GUSH because my business plan is the end-all-be-all. My loss sucked but it would have sucked harder if I didn’t have a business plan.
I have since made my losses back x 2 because I freed up those funds for other opportunities.
But, what do I know I’m not a richling…..not a peasant either.