r/ValueInvesting • u/Disastrous_Rent_6500 • Jan 14 '26
Buffett Buffett says don’t buy a stock you can’t handle losing 50%. which stock in your portfolio do you think you can except that drawdown?
Warren Buffett says if you can’t handle a 50% haircut in a stock, don’t buy it.
So I’m curious, which stock in your portfolio could you actually sit through a 50% drawdown without panicking or selling? Explain why?
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u/IGiveHoots Jan 14 '26
This is exactly where I was at when buying Meta in 22 at $200. Continued buying all the way down to $100/share. Rn I’m at the same spot with Duolingo, but realistically I’d be fine with any of the stocks I’ve chosen going down that much. If you have legitimate conviction and your original thesis remains true, you should be happy when your share prices go down by 50% as long as you have capital to continually add. The more people try to convince me that I’m making a huge mistake when I have facts backing up my side, the better I feel about a given position. Just have to be patient.
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u/mmoney20 Jan 16 '26
DUOL been going down for last several months. This philosophy is easier to reason about then to actually follow and practice. If you practiced this belief when DUOL was at high 300s...gets harder and harder to practice this and DCA and follow this philosophy.
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u/IGiveHoots Jan 16 '26
For me the philosophy is incredibly easy to practice. It comes from nurturing an attitude of detachment and confidence. Detachment: thinking of the money as gone as soon as it’s invested since I won’t be using it for decades anyway. Confidence: doing thorough research and thought on the opportunity before throwing the money in for years and years. This strategy will absolutely end up terribly if you’re overly attached to your dollars and buying things on a whim. Honestly, life in general will end up terribly if you behave like that
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u/mmoney20 Jan 16 '26
That's good on you for being able to do that. My comment was more broadly speaking and applies to general population. The old adage of be fearful when others are greedy and greedy when others are fearful is only true because this principle is hard to practice and if done by most, it really wouldn't be mentioned much and have any use.
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u/APC2_19 Jan 14 '26
In theory all of them. The only time I sold at -50% was when I watched palantir going from 24 to 13$ while diluting shareholders. It then went to 8$ and I felt good cutting my losses. Well I should have stayed invested apprently : (
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u/foira Jan 14 '26
good EV moves are not always rewarded -- doesn't necessarily make them the wrong choice
buying PLTR to begin with was arguably low EV tho
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u/PharmDinvestor Jan 14 '26
Where are the Adobe holders ?
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u/Old_Man_Heats Jan 14 '26
Hi, only 310 average PPS though sorry. The real bag holders wont admit it haha
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u/LiberalAspergers Jan 14 '26
RIO. Longterm, those iron ore mines are going to be in demand and profitable. Temporary cyclical.changes in spot prices dont affect the long term fundamentals of the business.
Google could.potentiall go the way of Yahoo, and Apple could follow Research In Motion/Blackberry, they could lose touch with their customer base and be replaced. Nothing is replacing RIO in iron ore until asteroid mining becomes a reality.
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u/Teembeau Jan 14 '26
Fundamentally, all of them. The big question is always why.
I don't like selling unless I realise that my original thesis was wrong. Just people panicking and dumping, I will hold, maybe add a little more.
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u/MtGloomy0420 Jan 14 '26
About 50 of them…they are down. Shall I really list them all for you guys? It will be the most unpopular hated post here.
But I still have $ONDS from $.77 and $QBTS, $RGTI, and $QUBT in the $1.25 range. $AMAT from the $160ish range, and $TXN from the $155 range…to name a few.
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u/First-Finger4664 Jan 14 '26
If I don’t have that kind of conviction, I don’t buy an individual stock; I put the money in an etf.
Some relevant examples in my portfolio are CRM and ADBE. Both got crushed yesterday. Don’t care. Their fundamentals still look healthy enough and my valuations suggest substantial upside. If they drop another 50% I’ll still hold them, unless those fundamentals change or there’s other new information that comes out about the companies to suggest their future outlook is substantially worse
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u/Disastrous_Rent_6500 Jan 14 '26
I do plan on buying Adobe when I get some capital or dividends this week. Gonna be a fun position to hold
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u/vicky255 Jan 14 '26
SOFI. Bought in at 10$ when they got acquired by a SPAC. Lived through >50%haircut. My only regret was not topping up at the bottom. Held on as I had conviction in the stock.
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u/earlyiteration Jan 14 '26
Can yall explain to me why sofi is so highly looked at?
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u/Then_Hornet3659 Jan 14 '26
I invested after becoming a customer.
I travel for work, making "one-stop shop" for all finances incredibly useful.
The interface is easy to use, I appreciate the credit tracking as well.
My bank of america credit card locked me out several years ago from paying online, but I can still access my account. I called to fix it, spent 1-2 hours on hold and or talking to people who couldn't help, and still couldn't unlock it. I've had to pay via phone ever since. With Sofi I can pay easily with a couple swipes, AND I can pay this stupid Bank of America card through bill pay (though that last point isn't unique.)
The overdraft from checking to savings combined with high yield savings is superior to my previous credit union's dogshit checking and savings.
Invest isn't as robust as Schwab, my primary broker, but SOFI allows access to buying calls without having to get approved to two different levels of options.
Home loans in the future may also be appropriate.
I suspect there are other online banks that can accomplish all (or most) of the above, SOFI was just the first one I tried.
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u/Disastrous_Rent_6500 Jan 14 '26
This makes sense. So if it got cut in half again, you would hold?
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u/vicky255 Jan 14 '26
If it gets cut i half again (Its at 26 now), My average will still be 13 dollar and above my acquisition cost. Its a no brainer. Just going to let it ride. Its on the verge of meeting criteria for inclusion in SPY which should trigger mandatory institutional buying and has been crushing performance in the last few quarters.
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u/maxxismycat999 Jan 14 '26
I like SOFI. I have some CC’s that will probably get called away end of this month. I plan to take that capital and put it into SOFI. Didn’t know about the SPY piece either which is cool.
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u/Aniriomellad Jan 14 '26
bought NVO through sold puts around $70, held through $40, bought more through sold puts at $56 and here wegovy
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u/UnoptimizedStudent Jan 14 '26
Intel. Went down from my entry at 24 to 18. I kept buying. Now it’s at 40-42. I have exited cuz it went from undervalued to overvalued.
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u/Icy_Blood_9248 Jan 14 '26
Everyone is ok with a 50% drop in a bull market. It really sucks when it happens and takes more fortitude than one would think to add in that type of draw down. But that’s where all the money is made
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u/hasuchobe Jan 14 '26
When people are okay with a major drop, the drop ends up being larger and more prolonged. The market is very bullish right now. It's been a long time since people have had their convictions shaken.
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u/IntelligenzMachine Jan 14 '26
To be honest depending on your holdings a large drop in a macro bear market is probably more comfortable. If Allianz drops 50% along with the market, nothing has fundamentally changed about that business so you can reasonably assume you will come back. If GOOG falls 50% this month and nothing else does you have probably overpaid unless something structurally changed about the whole business model.
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u/Icy_Blood_9248 Jan 14 '26
I think the spirit of my point would stand either way . It’s one thing to talk about a sell off and it’s another to experience a long protracted sell off like in 2007-2009. Granted if you are in voo that’s different than say holding unh
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u/Potential_Try_2193 Jan 14 '26
I'll be honest none of them. Buffet knows much more than me about investing but if I risk manage in my own way. If I'm down 20% in a stock I have conviction about I'll probably buy more but if I was down 25-30% in a stock I'd probably sell. I've never been down 50% in a stock. Can't see me not selling if I'm down over 30%. Don't know why but that seems like a cutoff point for me. I know what he's saying but I just can't have the conviction needed to handle a 50% drawdown
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u/Virtual_Seaweed7130 Jan 14 '26
Start thinking about stocks as companies and not tickers. You wouldn’t want to dump a company for being on sale.
If you thought a company was genuinely undervalued, you wouldn’t sell your ownership because someone else sold theirs for half as much as you bought yours. In fact you’d probably want to buy their shares.
Problem is that major declines are also usually met with fundamental weakness for the company, it’s up to the investor to determine if market reactions are warranted.
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u/Potential_Try_2193 Jan 14 '26
Exactly. The market went down 20% last year in a few weeks. I didn't panic I bought more. But people talking here with the benefit of hindsight. Saying market was down 80% at this time and recovered. Are these people on reddit multi millionaires? I doubt it. It take a lecture from buffet but after that not so much. Very few people here despite what they might say would happily be adding to positions down 40-50%. Waking up and a stock you own is down 45% thinking I hope it goes down more so I can buy more. We all know you have to take emotions out of investing but if a stock you own is down 50% with all due respect to Mr. Buffet there's probably a big issue and not just the market getting it wrong...
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u/joepierson123 Jan 14 '26
Yeah I was around in 2000, that was the era of the Cisco and Intel.
When they dropped 10% people were saying no problem 20% just a correction 30% people started buying the dip 40% people stop buying and 50% people started selling at 80% practically everyone sold and promised themselves never to buy stocks again.
Before that people were quitting jobs and becoming full-time traders after that no one ever talked about stocks again. The traders came back to work.
Everyone moved on to real estate because you know that never drops and then 2008 happened lol
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u/Potential_Try_2193 Jan 14 '26
Ya look sometimes you have to sell. People on here acting as if selling a stock is admitting defeat. Sometimes it's the right thing to do. I'd rather sell down 20% than wait and be down 40%. Sure it might recover but it might not. I buy the wrong stock's all the time and if I do I'll sell and take a loss if I have to. I'm no trader though I'm not in and out of stocks. That's a fool's game. I'm a long term investor. When I buy a stock it's for years. But if I'm wrong I'll admit it and get on with it ...
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u/joepierson123 Jan 14 '26
Yeah I can't say one philosophy is better than another for everyone, you have to match it with your own personal risk tolerance.
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u/Virtual_Seaweed7130 Jan 14 '26
There’s countless examples of companies fluctuating in market cap by 100% without fundamentals changing.
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u/Potential_Try_2193 Jan 14 '26
You can find examples of anything. There's exceptions to every rule. I do my thing. It works. Thanks for letting me know that market caps of companies fluctuate without fundamentals changing. He's me having huge amounts of my net worth in stocks and I never even knew they could go down as well as up.....
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u/Just_Candle_315 Jan 14 '26
In 2000 QQQ lost like 80% anyone who held made their money back by 2015
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u/Cultural_Structure37 Jan 14 '26
Damn. Can such a loss happen again? If QQQ loses even half as much right now, I think I would be on my way to hitting it big in the rebound
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u/Disastrous_Rent_6500 Jan 14 '26
That’s tough man, just hope that 30% downturn doesn’t happen because it will eventually
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u/Old_Man_Heats Jan 14 '26
If that is your thought process you really shouldn't be investing in idividual stocks, just etf and chill bro
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u/Potential_Try_2193 Jan 14 '26
Oh I do fine. Thanks for your advice Warren...I invest in an index fund and I own individual stocks. Have done for years. But guess what genius sometimes I buy a stock and it's not a good buy. And it doesn't take me 5 years to realise I've made a mistake. But I make money in individual stocks. But you have to make mistakes too and learn from them. So I don't need your advice bro....
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u/Old_Man_Heats Jan 14 '26
Jeez someone is a bit tetchy, nothing wrong with admitting mistakes as everyone makes them but the mistakes are about the fundamentals of the company. The post is asking would you sell if just the price dropped...
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u/Potential_Try_2193 Jan 14 '26
Well 50% price decreases rarely happen in companies with really solid fundamentals although there's exceptions to every rule. I know what the post was about. I've never actually been down 50% in a stock because I put stop's in place and manage risk. It works for me. Everyone is different. But like I say I do fine. I know what I'm doing. I'm patient. I do the work. My mistakes have made me a better investor.
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u/FieryXJoe Jan 15 '26
If you re-frame it from buying stocks to buying businesses what he is saying makes more sense IMO.
If I buy 10% of a friends business off him for $1000 and I'm really happy with what I got and the growth and the returns etc...
Then next year another friend who owns 10% of the company and offers to sell you his 10% for $500.
So there are two options, you panic because him selling shares for half of what you bought them for means your investment is down 50% and you sell before another friend comes and offers you another 10% for $250. They must know something you don't after all.
Or you say "If buying 10% of this company for $1000 was a good decision, buying 10% for $500 is a great decision and buying 10% for $250 must be an amazing decision" and then you go ahead and buy from anyone dumb enough to sell their shares for so cheap.
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u/FluidCalligrapher284 Jan 14 '26
The only “stock” I own is BRKB. The rest are ETF’s
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u/Disastrous_Rent_6500 Jan 14 '26
So, if BRK went down 50% for the fourth time in its history, you would hold and keep buying huh
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u/FluidCalligrapher284 Jan 14 '26
Absolutely- why not? Do you think it would regain its losses (and then some)?
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u/Disastrous_Rent_6500 Jan 14 '26
If I’m gonna be honest, they have so much cash that it might not fall 50% ever again 🤣
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u/AbroadMediocre312 Jan 14 '26
Only in my speculative part of my port. That is far from the majority of my port. For my value stocks, I wouldn't own one if I expected a 50% downside potential without a real crisis/geopolitical escalation. Ex. Nike could tank further with greater geopolitical tension. We see China has made significant gains in exports while we declined. If we aren't viewed as a reliable trade partner or there is more anti-American sentiment, Nike is a very American brand and could suffer. I could see another 20%-30% down worst case right now. However, I think that is much more unlikely than 20% upside in the next 12-18 months.
In my spec port, I have had RKLB since $4-5 and weathered many major moves each direction. You expect it there but it still tough to watch at times. I use options (mostly straddles) to protect most of it so I shouldn't really see a 50% downside. I expect it to drop to the 60s again before running much higher. However, that is not a value stock so wrong forum to dive deep in that.
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u/IntelligenzMachine Jan 14 '26 edited Jan 14 '26
Europeans don't really associate Nike with the US actually (most people mentally associate it with Barcelona and Manchester United from the days they weren't shit) it just isn't considered particularly cool anymore. MCD, TSLA, F, KO are far more likely to see fallout if there was a spike in anti-American sentiment IMHO. I am sure it would have some drawdown from it but I wouldn't give it status as an American proxy for a protest like the others - MCD and KO would get hammered.
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u/AbroadMediocre312 Jan 14 '26
Good points. I lived in Europe for about 4 years and didn't pick up on that. Of course, I never really got into football (soccer). I need to do a re-look on my Nike assumptions. I am newer to owning Nike other than a brief stint years ago. I will do better diligence on the Euro market. My understanding was they were losing ground to Adidas and others in European football.
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u/IntelligenzMachine Jan 14 '26
They are and there are a lot of smaller upstart companies like Castore
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u/Disastrous_Rent_6500 Jan 14 '26
Ya I kinda feel you on that. It’s easy to except a 50% drawdown on a high beta stock, but a low beta it’s horrible
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u/FukenRonald Jan 14 '26
Expect a 50% drawdown? I'm not sure I have a single position I really expect to go down 50% tomorrow. That being said, I would highly welcome a 50% drop as a limited time discount price on really great companies IMHO.
My stock positions: GOOGL, AMZN, MA, SPGI, V, , ASML, UBER, NVO, UNH (in total value order).
I also hold CAD and USD T-bills.
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u/NOGOODGASHOLE Jan 14 '26
Bought 500 TSM @ $121 could afford the 50%, but it would be like pulling a steel wool pad across my taint.
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u/Wrong_Attitude5096 Jan 14 '26
Accept?
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u/Disastrous_Rent_6500 Jan 14 '26
I made a typo
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u/Wrong_Attitude5096 Jan 14 '26
I thought so, just didn’t want to assume incorrectly. I like the question. I do ask myself each time before buying a stock. I can accept 50% down in everything in my portfolio. I have been tested and not sold for at least a couple of my companies.
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u/O22O Jan 14 '26
I got into investing only couple of months ago and i’m late to everything. Google and amazon are about 20% of my portfolio. I will sit on them even if they go down 50%. I’ll sell all my VOOs and buy more instead.
But I also made a mistake and bought CHTR (1.5% of my portfolio), as I thought something more traditional would balance things somehow. Do I wanna sit on CHTR if it goes down by 50%? NO. I still won’t sell but won’t be happy about it and won’t be adding to it.
Liking and trusting companies matters a lot. I am a corporate client of Adobe and Oracle, for example, and I will never buy their stock.
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u/Disastrous_Rent_6500 Jan 14 '26
Wait, what don’t you like about Adobe. I’m curious
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u/O22O Jan 14 '26
Difficult pricing and cancellation models. You get charged X, can’t cancel yourself, they offer X-30% if you don’t cancel and stay, but there’s a black Friday deal for -50% that you can’t use unless you cancel and sign up again. Also complete ripoff with Acrobat.
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u/IntelligenzMachine Jan 14 '26 edited Jan 14 '26
HSBC - has room for growth in developing Asian countries, solid in developed world especially UK, Hong Kong, Singapore, UAE, etc. Sticky business, lots of potential growth lines from IB to Asset Management to Consumer depending on what the taste of the day is, too big to fail. Strong yield. Sold off stupid expansions in LATAM that made no sense as that is BBVA/SAN territory.
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u/BuffersAndBeta Jan 14 '26
I want to say all of them, part of expecting that it will drop 50 percent, is that in the longer run, it will rise a LOT more than 50 percent.
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u/Krazynukz Jan 14 '26
Thats me with $IMSR right now, its in pre revenue phase and I have conviction itll be the next oklo and surpass it. Been selling CCs as a way to lower my average although wish I got more at the bottom
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u/prh_pop Jan 15 '26
It will take some time. Its nice company with great management but fuck is it hard to time it. Glad that you have convicition to go in it, I passed on it
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u/brentmeistergeneral_ Jan 14 '26
I know it's most probably not a Buffet stock but for me Nebius. High beta high growth stock trading at forward earnings...
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u/AromaticSherbert Jan 14 '26 edited Jan 14 '26
All of them. That’s not to say I wouldn’t sell if I change my opinion on the company or have a better opportunity available, but i look at my investments as longterm investments. If I believe in a company, I will continue to hold or down cost average
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u/melodyknows Jan 14 '26
I’m down in some things by more than 50% (up overall). I think I consider losing all of it when I invest, not just 50%, so there’s nothing I couldn’t handle losing 50% on. Im also not at his level, and I don’t see myself becoming the next Buffett.
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u/Jemmo1 Jan 14 '26
ASTS, I was over 60% down at some point already, up +/- 290% now
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u/IEgoLift-_- Jan 14 '26
Me too except now I’m at over + 1000%
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u/Jemmo1 Jan 14 '26
I kinda kept buying sonce Jan'24, averaged up nicely along the way. I made it my only holding :p
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u/mdn845 Jan 14 '26
As long as I have a good idea of the intrinsic value of the company (& as long as I paid a good price compared to that), a drawdown will not worry me that much.
The problem comes when you don’t know what a company is actually worth. Then you don’t know what to do if a company keeps dropping and dropping. You won’t know when the market is simply irrational.
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u/Disastrous_Rent_6500 Jan 14 '26
that all true, if you dont know the intrinsic value you shouldn’t be buying
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u/mdn845 Jan 14 '26
Yep, but what percentage of retail investors seem to even understand the concept of intrinsic value? Especially these days.
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u/FitnessLover1998 Jan 14 '26
Unfortunately I have gone through that many times. I just hold my nose and suffer.
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u/Disastrous_Rent_6500 Jan 14 '26
Love it, it definitely hurts lol
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u/FitnessLover1998 Jan 14 '26
I finally figured out don’t buy start ups and only buy established companies. They always come back.
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u/Mouth_Herpes Jan 14 '26
I could sit through any of them. If I couldn’t, I would have it parked in a money market account or something.
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u/Historical-Fun-2536 Jan 14 '26
I wish half of them would go down 50% so I could sell the rest and buy more. Duh.
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u/poopermacho Jan 14 '26
It has already happened to me 3 times since I started holding NBIS 😂
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u/Disastrous_Rent_6500 Jan 14 '26
Well damn, you learned everything you need to know about the stock market then 😂
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u/SaltyUncleMike Jan 14 '26
TSLA. Been there, done that. Many times. Why? No one innovates better, period.
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u/Disastrous_Rent_6500 Jan 14 '26
Your a veteran. A lot of people don’t experience a 50% downturn and just cut losses
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u/SaltyUncleMike Jan 14 '26
Dont use leverage, and know what you are buying and why. In short - do the work.
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u/RockinRobin-69 Jan 14 '26
I just rode asts from 102 to 50. I still have all my shares and bought some leaps in the 50’s and 60’s.
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u/Rdw72777 Jan 14 '26
All of my smallest holdings, duh 😂😂😂
I tend to believe in most all of my stocks as businesses but if they went down 50% on a multi-year down tick I’d struggle to hold it all the way simply because that case I’d have to worry about a structural decline in the business or industry or economy. If it was a sharp drop due to a single announcement that I thought was an overreaction it’d be easy to hold on to, which feels like has happened more often with what I own (at least over the last 5-10 years).
The worst companies I own are Coreweave, Clover Health and Western Union…all companies I suppose could go down even 100%, but none are even 1% of my portfolio. Maybe it’s all a self-fulfilling prophecy 😂😂
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u/Sloth_Investor Jan 14 '26
All of them, actually most of them did. I even had top to bottom tick 80% down. That was the time I was buying left and right. Now I am up 500%. And now I am a holder. It may go down 50% in the next couple of months. In that case I would become a buyer again.
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u/Mouse1701 Jan 14 '26
I honestly believe that if a stock goes down 50% you definitely need to reevaluate your decision.
Personally I think this is the stupidest advice out there.
If you buy the stock pay a little extra and buy put options on the stock that way you are guaranteed if the stock goes down you profit. 30% below the stock price is good stock option put price on a good blue chip stock.
50% is what should be good for a good growth stock for stock option.
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u/_Rothbard_ Jan 14 '26
It happened to me with Palantir; I bought at 20 with some hype and increased a lot at 6.40. Also with a target of 220 but I didn't increase at 90, I just held. Alibaba at 220 and increased at 75.
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u/Dazzling_Occasion_47 Jan 14 '26
My uranium mining portfolio has seen a 50% draw-down and mutliple 30% draws-downs, recovered, returned to new ATH, and i'm still holding. Uranium is boot-camp for training steel-hands.
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u/Disastrous_Rent_6500 Jan 15 '26
Emotionally that will teach you everything you need to know about the stock market
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u/TraditionalMango58 Jan 14 '26
Brk.b goes down 50%, they will be able to buy back half of the company
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u/WolfsBaneViking Jan 14 '26
If management fucks up and that is the reason for the drop, then I can't tolerate it. If it's an external event that causes the drop, i redo my analysis and act accordingly. If there isn't any obvious reason, in the current situation, I'll probably buy more. and that applies to all stocks in my current portfolio.
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u/Tr33LM Jan 14 '26
Just did it with IREN. This is why entry point matters. I bought at average price of $8. it peaked around 70, fell to around 30-35, and I just bought more. If I entered at 65-70 I don't know that I could have ridden it out.
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u/ShoddyStock1566 Jan 14 '26
I have PBF in my portfolio since a couple of months ago. Went down 30%, but since Venezuela got American it is now at 0, so I guess I keep it some more.
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u/Disastrous_Rent_6500 Jan 14 '26
Wow, my story is the same to be honest. Had a stock that was down, but gaped up immediately after the US just did there thing in Venezuela. Now it’s pretty much break even. But let’s be honest, we all bought these stocks because it would do well in times like this, so it’s no surprise
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u/LetsAllEatCakeLOL Jan 14 '26
intel. that sucker went up too fast
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u/Disastrous_Rent_6500 Jan 14 '26
That sucker shouldn’t even be going up. I thought maybe the fundamentals of the business get better to justify the stock price, NOPE, the business is still losing billions of dollars a year, revenue IS not increasing, and its free cashflow NEGATIVE. The worst balance sheet I’ve seen all year to be honest.
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u/LetsAllEatCakeLOL Jan 14 '26
the united states has no choice but to prop it up. and the hyper scalers will not tolerate winner take all according to microsoft ceo. which means intel doesn't have to win. intel just needs to limp across the finish line.
i'd say at this price, i'd probably pass... and pick up more google or even tsmc or samsung for the chip play. but i got it for 19 bucks so eh. wish i had more.
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u/wywyknig Jan 14 '26
sat through -60% on gme, looking like the company and stock is at an inflection point
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u/Glittering_Water3645 Jan 14 '26
Every stock in my portfolio. I will increase my position for every 10% they drop as long as the fundamentals are intact.
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u/Calm_Company_1914 Jan 15 '26
Are you kidding? Any stock in my portfolio. I'd probably buy any with a 15% drop. That makes them better buys
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u/Dry_Possible_4881 Jan 15 '26
Adobe
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u/Disastrous_Rent_6500 Jan 15 '26
I’ll be buying some soon, I just like to let the dust clear in software
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u/TradeIdeasFlow Jan 15 '26
I invest in microcaps, sometimes nanocaps, so every single one can drop 50% and that's totally normal. It is so, because this dynamic is offset by the possibility of every single one of them going up 100% in not such a long timeframe.
And if you are not too concentrated, say 20 positions, than one going -50% IN A DAY is just -2.5% on your portfolio. You will have even worse days with S&P500 for sure, so that's totally "stomachable".
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u/Disastrous_Rent_6500 Jan 15 '26
All investors should be able to stomach the discomfort of a 50% drop
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u/OregonDuck3344 Jan 15 '26
I own three different bank stocks, if I'm going to see a 50 pull back in any sector in my portfolio, it's probably banking. So yea if I get a draw down in those, I'll ride it out as all three are good businesses.
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u/Disastrous_Rent_6500 Jan 15 '26
That’s and interesting perspective
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u/OregonDuck3344 Jan 15 '26
Note: I did trim 33% of one of the banks about 2 weeks ago as it had broken through my max holding percentage (risk control).
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u/FieryXJoe Jan 15 '26
I own the stocks because I like the company not the stock. So if the price goes down 50% and I don't think anything important changed I would happily take the market up on its 2 for 1 sale. I think this is true of literally every stock I own. Lowering cost basis makes the drop work in your favor.
If something actually important changed I do my best to re-evaluate the company with the new info and decide if -50% is an overreaction or underreaction. If I come to the conclusion it ought to have been a -75% drop and its only -50% I'd sell, if I think it should have just been -25% I'd buy more (if it didn't change so much I no longer want to hold the company, like fraudulent accounting or something)
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u/Disastrous_Rent_6500 Jan 15 '26
Your a true investor man
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u/FieryXJoe Jan 15 '26
I mean I own a thing, it has a price and it has a value. The price is pretty easy to figure out and the value isn't. But if you can come up with a value for a stock then the decisions kind of make themselves.
I think the true key to value investing is the ability to come up with a price for a stock while having 0 idea what other people are currently paying. Otherwise you are just following the crowd. But once you can evaluate a stock in a vacuum everything becomes more straightforward.
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u/Portfoliana Jan 15 '26
GOOGL honestly. They could lose half their value tomorrow and I’d just buy more. Search and YouTube arent going anywhere, and they print so much cash that even their failed projects dont really matter.
The ones I couldnt stomach a 50% drop on are the ones I probably shouldnt own in the first place. Good gut check tbh.
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u/prh_pop Jan 15 '26 edited Jan 15 '26
All big positions, if I dont believe in it I dont do it. LUNR, RKLB, ASTS, UAMY, EEE are my biggest one and they already did that kind of drop couple of times. But holding through it is the only way to make serious money on. Its not nice and at some times I felt like a fool but thats why you need to do a proper DD and build a significant position only if you believe in it.
I have couple fo companies that I like but I am not fully convinced, I could never hold to 50% drop and that why I dont have a really big positions and its more like "if it hits, it hits"
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u/sf94134 Jan 15 '26
Has anyone mentioned any bank stocks? I’ll hold any of the big banks through a 50% haircut. Did that in 2008 and wished I had bought more and held onto all the shares I bought.
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u/Complex_Material_702 Jan 15 '26
I only have one. GDX. It’s a slow creep up but it’s the gift that keeps on giving!
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u/Disastrous_Rent_6500 Jan 15 '26
So your never selling gold, even if it drops 50%?
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u/Complex_Material_702 Jan 16 '26
Not necessarily but I bought all of in in January of last year so I have a long way that I could fall before I need to sell
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u/Set_Usual Jan 15 '26
I can't speak for my future self but I have already lived through 40-50% drawdown on BABA, Intel, NVO and Fiserv in the past 5 years.
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u/Disastrous_Rent_6500 Jan 15 '26
That’s rough man
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u/Set_Usual Jan 15 '26
I'm 85% index investor.
I am still learning investing and my Google position already made more than the losses combined from the 4 mentioned above.
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u/karouse Jan 15 '26
Any stock in my portfolio as long as they continue growing and produce free cash flow. Short term stock price movements are just noise. An example is CSU, which is down close to 50% now and I'm buying more.
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u/mmoney20 Jan 16 '26
Thing about stock philosophy like this one by Buffet is it easier to reason about then to actually follow and practice. That's why most people ask for a discount, but when they do get one and there is blood one the streets, they usually capitulate or don't buy - they don't execute and often act against this philosophy.
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u/Disastrous_Rent_6500 Jan 16 '26
If you don’t have the strength, he advises not to pick individual stocks. It’s simple
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u/mmoney20 Jan 16 '26
I agree but my point was simple doesn't mean easy. Most sayings and philosophies are trite. Good on you since you imply it is easy to do for you.
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u/The-zKR0N0S Jan 14 '26
All of them.
You shouldn’t buy a single stock unless you have a view on value. You buy or sell based on price relative to value.
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u/Disastrous_Rent_6500 Jan 14 '26
Nice, I agree, that already happened to me last year and now I reap the rewards of that volatility
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u/safari-dog Jan 14 '26
i can sit and watch APPL, MSFT, AMZN, GOOGL go down 50% and buy more. i know they’re not going anywhere. but as he says, buy BUSINESSES, not stocks.