Fully invested but stuck in losses, finding it increasingly frustrating? To everyone who feels both

Dear fellow investor! On your investment journey, you may find your emotions swayed daily by market fluctuations, your patience worn down by being locked in positions, and your clarity diminished as information overload leaves you increasingly confused. However, it’s perfectly fine to slow down. We have specially launched the 'Long-Term Answers' column to help you return to the essence of investing, face volatility with a long-term and rational perspective, and regain your own rhythm in an anxious market. If this resonates with you, feel free to explore further.Click hereSubscribe to the learning program, and you will receive notifications when new updates are available in subsequent columns.

You are likely overwhelmed daily by a flood of investment-related information: something skyrocketed, another plummeted, some development brought good or bad news, and others claim to represent the current investment trend...

But here lies the problem: you might currently be deeply trapped in certain stocks, or fully invested with no additional liquid capital. As a result, even if you clearly know which investments will yield future profits, you may struggle to seize those opportunities. Alternatively, you may face decision paralysis due to too many options, unsure of what to buy and unable to pinpoint certainty.

Many investors find themselves in similar situations: their accounts filled with red and green figures, some stocks they’ve forgotten why they purchased, others held onto stubbornly out of reluctance to cut losses... Each day, opening their trading software, they see others’ portfolios soaring while their own accounts remain stagnant like still water—or fluctuate wildly like a roller coaster. The more they watch, the more frustrated they become, yet they remain stuck and unable to move forward.

In fact, rather than advice on 'what to buy,' what you might lack more is the ability to 'manage the mess of money and assets at hand.' This article is specifically written to address this issue, discussing your portfolio and holdings, your real-life investment challenges as an individual, and how to navigate them.

1. Shift Your Mindset: From 'Chasing Opportunities' to 'Managing Your Portfolio'

First, ask yourself: How much time do you spend daily watching the market, refreshing news, and researching the next potential breakout stock? And how much time do you devote to carefully reviewing your current holdings? If your answer indicates far more time spent on the former, you may be caught in a cycle of ineffective effort.

You may chase trends every day—today AI, tomorrow precious metals, the next day energy… Buying whatever rises and panicking to sell whenever there’s a drop. Though you may seem to spend ample time studying investments, your portfolio performance hasn’t improved and might even worsen.

This is akin to a farmer who constantly monitors his neighbor's fields, observing what new crops they plant or fertilizers they use, but neglects to water, fertilize, or weed his own land. In the end, you hear about bountiful harvests everywhere except from your own increasingly barren field.

Starting today, try shifting your focus from 'what’s out there' to 'what I have and what I need to do,' and establish a new strategic mindset: treat your investment account as a small business to manage. You are the CEO, each holding represents a business line, and your cash is the company’s reserve fund. Your job isn’t to search for new projects daily but to ensure all operations run smoothly, keeping the entire enterprise healthy and thriving.

With this mindset, let's examine the following specific issues.

2. Conduct a comprehensive check-up first: Is your current portfolio healthy?

The first step in managing a company is to understand its assets.

It is recommended that you open your account now and review each position honestly by answering the following questions:

① What was my reason for buying it? Does this reason still hold true today? You may be surprised to find that you have completely forgotten why you bought some stocks; in such cases, it’s time to reassess the rationale behind holding them. If the logic for purchasing has been invalidated, it’s time to liquidate the position.

② What role does it play in your portfolio? For example, determine whether it serves as an offensive vanguard or a defensive anchor. Ideally, your portfolio should strike a balance between offense and defense. If all your holdings are growth-oriented stocks, you may struggle significantly when market trends shift.

③ Is its proportion in your portfolio reasonable? Position sizing is an issue easily overlooked. Check whether any single stock holds too large a share of your portfolio, causing your account to experience significant volatility when it declines. This is known as concentration risk. A well-structured portfolio should be layered, relatively diversified, and aligned with your expectations.

④ If you were currently fully in cash with no positions, would you still buy this stock? This question is tough but extremely effective. It forces you to disregard sunk costs and reevaluate each holding purely from the current perspective. If your answer is hesitant or negative, then why continue holding it?

⑤ Can you succinctly describe your plan for this position? For example: Hold until the next earnings report, sell if revenue growth falls below 20%; reduce the position by half when it reaches a certain price level, etc. If you cannot articulate any plan, it means you are investing passively. Passive investing can often turn out to be the most expensive strategy in investing.

After completing this round of evaluations, you can roughly categorize your holdings into three types:

● One type is high-quality holdings that can be retained: the rationale is sound, the position size is reasonable, and there is a clear plan.

● Another type is observation holdings: the rationale partially holds but with concerns, requiring time-limited monitoring.

● Yet another type is assets pending liquidation: the rationale no longer exists, making it unnecessary to hold them further.

For those positions you decide to keep—those with solid fundamentals, long-term potential, and an intention to hold for an extended period—there is a tool often overlooked that can generate additional income while holding these quality positions. This tool is the Covered Call strategy.

Simply put, if you hold 100 shares of a stock, you can sell corresponding call options and collect a premium. This premium serves as your additional income, essentially trading a portion of the stock’s upside potential for immediate cash returns.

Here’s a simplified example:

You hold 100 shares of a stock currently priced at $100 (which is also your cost basis). While you are optimistic about its long-term prospects, you believe significant short-term appreciation is unlikely.

You sell a call option with a strike price of $110, expiring in one month, collecting a $300 premium.

If the stock price does not reach $110 by expiration, the option expires worthless, and you keep the $300 as pure profit.

If the stock price exceeds $110, you will need to sell the 100 shares at $110. You still profit from the $1,000 price difference plus the $300 premium, though you forfeit any gains beyond $110.

3. The most tormenting question: What to do with stranded assets?

Being stranded is the most agonizing experience; every glance at your account shows that glaring negative number, constantly reminding you of a wrong decision. Most people in this situation choose to hold on stubbornly, convincing themselves that as long as they don't sell, it's not a loss, and wait desperately for the day they break even.

This is a natural reaction, but it represents passive waiting. More importantly, the belief that 'once it breaks even, I'll sell' may be one of the most costly obsessions in investing.

Consider this calculation: A 30% loss requires a 43% gain to break even; a 50% loss requires a 100% gain; a 70% loss requires a 233% gain…

During the long period of waiting to break even, your capital is completely locked up, unable to do anything else. This is opportunity cost — not only have you lost money on paper, but you've also missed potential earnings that this capital could have generated elsewhere.

Therefore, when facing stranded investments, the truly rational way of thinking is not 'when will it break even,' but rather: 'If I didn't own this stock now and had an equivalent amount of cash, would I buy it again? Or are there better opportunities?'

Scenario One: The rationale still holds, but time has not yet come. The company’s fundamentals have not deteriorated, and the core reason for your purchase remains valid. The stock price decline is primarily due to market sentiment, broader market drag, or short-term negative factors.

In this case, you can continue holding, or even consider moderately averaging down costs by purchasing more at lower prices. Additionally, the aforementioned Covered Call strategy applies here as well. However, the prerequisite is to set a clear observation period and trigger conditions for yourself. Waiting with a deadline is called patience; waiting without a deadline is called numbness.

However, even if the rationale still holds, if recovery requires a very long time, you should also consider the issue of opportunity cost. Ask yourself: Is there a better use for these funds? If another investment with higher certainty awaits you, while your money remains trapped here for a long time, then waiting for breakeven itself becomes a loss.

Scenario Two: The rationale is broken, but you are reluctant to let go. To be honest, this is the most common scenario. The reasons for buying no longer stand — perhaps due to consecutive declines in performance, shifts in industry trends, or competitors gaining the upper hand — but you hesitate to sell because you do not want to confirm the loss.

At this point, you need to confront a harsh reality: the market does not care about your purchase cost. Stock prices will not rebound out of sympathy for your losses. Each day you continue to hold, you are essentially using today’s capital to keep paying for an asset whose rationale has broken down. Cutting your losses decisively and reallocating funds from an inefficient position to a more efficient one is not 'cutting meat,' it is optimizing capital allocation.

However, if the loss has become substantial, say over 50%, the psychological impact of fully stopping losses at once can be quite significant, and the remaining amount of capital may also be very limited. In such cases, consider exiting in steps: there is no need to liquidate everything at once; instead, gradually reduce holdings over two to three stages. With each reduction, you release both financial and mental space. Meanwhile, you can use the freed-up funds to allocate toward assets in which you have more confidence, allowing your account to gradually rejuvenate.

The key principle in addressing this issue is: do not allow a failed investment to hijack the future of your entire portfolio. Sunk costs are sunk, and the only thing you can do is ensure that every remaining dollar goes to where it can generate the most value.

4. Manage your bullets and anchor on better opportunities.

Once you have completed a shift in mindset, conducted a review of your holdings, and dealt with the most mentally exhausting trapped assets, you should now have some bullets—whether it’s cash released from clearing positions or idle funds added monthly.

Many people at this stage will immediately fall into the impulse of wanting to spend as soon as they have money. This is normal but also dangerous. You’ve worked hard to pull your funds out of the mire, and if you impulsively pour everything back in, you might jump from one pit into another.

Take your time. It is advisable to first review and optimize the allocation of funds in your account. The standards here vary by individual and may adjust dynamically with market conditions, but you need to set your criteria and adhere to them.

For example, core positions with strong logic, long-term optimism, and intent to hold might constitute around 50%; allocations based on medium- to short-term trends or event-driven strategies with clear entry and exit plans could take up 20%-30%; and reserve funds of 15%-20% would ensure you are able to seize opportunities when critical moments arise.

So the next question is: with so many opportunities, where exactly should you aim?

From a long-term perspective, many retail investors lack a “macro-first, then asset selection” approach. The most common decision-making path for retail investors is bottom-up: hearing that a particular stock is good → reviewing research reports and technical analysis → deciding it’s worth buying → purchasing. While this approach is not invalid, there is one problem: even if the stock you choose is excellent, if the broader macro environment and major fund flows are not in your favor, it may remain stagnant for a prolonged period or even decline against the trend.

To use an analogy: you are rowing a boat in a river. Individual stock research determines your rowing technique, while macro trends determine the direction of the water flow. Rowing downstream, even with average skills, the boat will move quickly; rowing upstream, even if you are a world champion, you will become exhausted.

Therefore, before deciding where to allocate your resources, ask yourself a higher-level question: in this current era, which way is the water flowing? It’s advisable to review professional institutions and analysts’ macro assessments. For example, economist Ren Zeping argues:

The upcoming trends include: the global macro environment entering a relaxation cycle, China and the U.S. entering a new interest rate cut cycle, a new wave of technological revolution led by AI alongside the arrival of the Kondratiev cycle, an explosive growth of AI super applications, continued boosts to commodities driven by dollar depreciation and the rise of AI super applications, as well as increasing geopolitical tensions.

Based on these trends, sectors with strong certainty over the next 1-3 years include: large AI models and Agents, robotics, autonomous driving, AI healthcare, semiconductor computing power for chips, defense (aerospace + satellite communications), etc.

Even after understanding the broader direction, it does not mean you need to act immediately. You can maintain a concise watchlist—for example, continuously tracking 5-10 targets that you have thoroughly researched—and set specific trigger conditions for each target, waiting for the right opportunity to intervene.

5. Knowing but not doing? Take the first step toward change right now!

By this point, you may feel that the article makes sense, but after reading it, you return to your usual inertia, finding it difficult to conduct any real review or make meaningful changes to your portfolio, thus remaining stuck in dissatisfaction with your account.

This feeling of knowing but not being able to act is not necessarily due to a lack of execution ability; rather, it stems from the fact that the first step toward change often seems too daunting—you think you need to overhaul your entire portfolio, reevaluate all holdings, and establish a perfect system... just imagining it is exhausting, so you end up doing nothing at all.

However, the truth is, you don’t need to do everything at once. Just complete one task today, for example:

You can open your account and take a quick look to identify which holdings might be problematic.

A stop-loss order can be set for a position that should have been stopped earlier but has not yet been acted upon.

You can take out a sheet of paper and sketch a framework diagram to organize your portfolio.

You can also leverage Futubull AI by clicking on the image below to analyze your portfolio structure.

By taking just one step, you will have transitioned from passively enduring losses to actively managing your investments.

Comprehensive change never happens overnight, nor does account recovery. It may take weeks or even months to gradually organize a chaotic account into a state where you feel in control.

During this process, there will be hesitation, reluctance, and frustration over seeing stock prices rebound after making a stop-loss decision—these are all normal experiences faced by anyone who takes their account seriously.

What matters is that you begin to take responsibility for your account, acting based on rationality rather than emotion. Even if each action is small or potentially flawed, real feedback gained through genuine actions allows your rational decision-making system to replace ingrained habits, progressively establishing healthier patterns.

Take this step right now, immediately!

That’s all for today! Click here to join the learning session; updates to the “Long-Term Answers” column will be announced. Specific content suggestions are warmly welcomed!