11-15-2020, 05:05 PM
Sunk Cost Fallacy and Your Bags
<!-- SC_OFF --><div class="md"><p>I just had a discussion with another poster who was talking about how he was still holding alts that were down 95% since 2017. He was complaining about how he didn't even follow the projects anymore and that he considered the money lost. </p> <p>Anyone who has been in crypto for more than a few years has most likely picked some losers along the way, but the weird thing was when I asked him why he didn't just pull out his money and put in to a project he actually believed in, he said he was waiting for them to pump a little and make up some of his losses first.</p> <p>This is textbook sunk cost fallacy, and it got me wondering how many people on here are making the same mistake.</p> <p><a href="https://thedecisionlab.com/biases/the-sunk-cost-fallacy/">The Sunk Cost Fallacy</a> describes our tendency to follow through on an endeavor if we have already invested time, effort or money into it, whether or not the current costs outweigh the benefits.</p> <p>If you currently have a bag of something worth $100, but you wouldn't spend $100 to acquire that same bag, you should sell immediately and put that money in to something you actually believe in.</p> <p>tl;dr: don't be afraid to sell your losers!</p> </div><!-- SC_ON --> Kind Regards R
<!-- SC_OFF --><div class="md"><p>I just had a discussion with another poster who was talking about how he was still holding alts that were down 95% since 2017. He was complaining about how he didn't even follow the projects anymore and that he considered the money lost. </p> <p>Anyone who has been in crypto for more than a few years has most likely picked some losers along the way, but the weird thing was when I asked him why he didn't just pull out his money and put in to a project he actually believed in, he said he was waiting for them to pump a little and make up some of his losses first.</p> <p>This is textbook sunk cost fallacy, and it got me wondering how many people on here are making the same mistake.</p> <p><a href="https://thedecisionlab.com/biases/the-sunk-cost-fallacy/">The Sunk Cost Fallacy</a> describes our tendency to follow through on an endeavor if we have already invested time, effort or money into it, whether or not the current costs outweigh the benefits.</p> <p>If you currently have a bag of something worth $100, but you wouldn't spend $100 to acquire that same bag, you should sell immediately and put that money in to something you actually believe in.</p> <p>tl;dr: don't be afraid to sell your losers!</p> </div><!-- SC_ON --> Kind Regards R