A while ago, I was watching a stock that everyone seemed excited about. Good news, strong price action, lots of confidence in the comments. It felt like one of those trades you are supposed to take.
But something felt off.
Not because I thought the company was bad. Not because I had a better stock to buy. It was because I could not clearly answer one simple question: what is the worst thing that could happen if this goes wrong?
I realized I had only looked at the upside. How high it could go. How fast. What the “best case” looked like. I had not seriously thought about the downside.
So I did nothing.
A few weeks later, the stock dropped hard. Nothing dramatic happened. No big scandal. Just a shift in sentiment and liquidity. People rushed out the same way they rushed in.
I did not make money. But I also did not lose any.
That experience changed how I look at trades. Sometimes the best decision is not buying or selling. It is stepping back and asking if you are prepared for the bad outcome, not just hoping for the good one.
Curious how others here think about trades they choose not to take. Do you track those decisions, or only the ones you enter?