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Special Section Investmental illness: A guide to getting well

Did you make an investment mistake? If you can't bring yourself to sell, despite superior alternatives, read on.


Afflicted investors are unable to sell obviously failed investments -- even after their original investment thesis has collapsed -- because of an irrational aversion to admitting error.

Victims of I'll-be-darned-itosis will hang on to investments, confident that they'll be able to break even down the road, even though superior investment alternatives exist, and they could easily sell, take a capital gains loss and reinvest their money more profitably elsewhere.

Treatment: Experts advise investors to accept responsibility for the mistake and move on. "We always ask our clients, 'Would you buy the stock today?'" says Matt McGrath, financial planner with the Miami area wealth management firm Evensky & Katz. "Every day you own a stock, you are effectively buying it all over again."

-- Posted: July 31, 2006
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