Discussing How to Recover from a Bad Investment Decision with Rani Jarkas
1. Don’t take it
personally; the idea failed, not you
Even the most
seasoned experts make bad investments sometimes. However, they don’t let these
losses stop them from investing. They simply learn from it and move on. You
should do the same.
2. Understand the
sunk costs and opportunity cost
Sunk cost is the
irrecoverable loss made from a bad investment. The downside is that it might
actually cause bigger losses. Opportunity cost, on the other hand, is what you
miss out on because you chose a specific action. You might have avoided a
larger loss if you had spread out your capital amongst various investment
vehicles. Understanding the sunk cost and opportunity cost of each investment
you make will help you recover from bad investments much quicker.
3. Seek legal
redress
In some cases, you
may be able to seek legal redress for a bad investment. Of course, this only applies
if you lost money because your fund manager acted in ways that violated the
terms of agreement. Ensure you have proper documentation to back up your claim.
4. Do your due
diligence
Oftentimes, bad
investments are the result of making uninformed choices. To recover, always do
your due diligence before making any investment decisions. You may also consult
a trusted financial advisor to help you understand investment concepts that may
be a little complex.
Cedrus Investments, led by Rani Jarkas is equipped with high standards and quality business systems. At Cedrus Investments, Rani Jarkas with proven and relevant Financial Planning experience, recommends only approved and high-quality services and products that are fully secure and backed.
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