Dividend Chaser on 2 options when investment goes bad

(Personal Sharing)

There are 2 options to take when an investment goes bad.

Option 1
We could cut our losses. This would mean believing that either the income producing investment is no longer able to produce the income that it has been producing or the market price of the investment is going to decline even more significantly in future.

Option 2
Stay invested. This would mean believing that the income producing investment is still able to produce the income that it has been producing or even more. It could also mean believing that the market price of the investment has stabilised or could even appreciate.

For people who have not overpaid for their investments, of course, option 1 would be more a question of protecting any capital gains. 

I did option 1 lately when I sold all my silver in my uob silver account and terminated the account. It was done at a loss equivalent to half of the original capital. There was a charge incurred even when I closed the account.

I felt there was no point holding on to my silver investment because the future looked bad for silver these few years. Furthermore, there is no return at all from the silver investment. This is unlike stocks which can give dividends to shareholders.

Once the decision was made, there was no turning back. The money from the sale of silver was transferred back to my uob bank account.

I have not decided yet how to make use of the money but I know it would not be silver or gold again.