Ridiculous sure, but remember plenty predicted it was about to drop well below $100 when it was at $115 and look where we are now!
Not quite sure what the appropriate saying is for the opposite to ‘don’t try to catch a falling knife’ but CBA surely epitomises it.
CBA is one of those stocks (now for around 30 years) that analysts & fund managers love to hate - after making fools of them so many times in their 'market timing'.
I've mentioned this before, but in the early 2000s my better half went along to a lunchtime S&P event for fund managers & bankers where towards the end they asked some questions back. After a few they asked how many of you bought CBA in the float - arms up. Everyone.
Then - how many took stag profits - arms down. Something like half dropped.
How many once the price doubled, trebled - you get the picture. Guess who ended up the only one with their arm up?
"Congratulations, CBA outperformed every other company on the ASX..."
Moral of the story, most investors, (so-called) professional or otherwise
too often cut their profits & let their losses run.
Nobody ever likes to acknowledge they've made a mistake...
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A good rule of thumb is to have a notebook which you diligently keep current.
For each investment you have there should be an entry. That should have in no more than say a dozen words each, the top three reasons why you bought the investment.
Noise is always a problem - IMHO the most important question to focus on is 'What's changed?'
Brokers etc only make money through transactions, so does the taxman. If you're worrying about an investment, to the point of loss of sleep then the decision is made for you.
Some more 'sophisticated' investors run the numbers and buy insurance if it is a potentially better outcome. If you've been clever (lucky) enough to have created a large (giant?) unrealised profit and fear the end of the world is nigh - but could be wrong (again?) - some look at buying slightly out of the money long dated (not the ones expiring next, or perhaps even the one after that) put options.
That way if they're wrong then they haven't made the tax man happy and if they're right then they're pretty much covered.
Lots of reading up is worthwhile.
My own rule is
N E V E R ever sell a put option - I've and places I've worked have bankrupted too many experts, and wiped out the capital of one of the Official Dealers in the mid/late 1980s who thought selling OTC out-of-the money put options on 10yr bonds was easy income.
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