Only average down if you confident with the business model and it will turn around or you could be buying into a dog.
people selling and dumping stocks is not a concern because they may not know the business as well as you.
I start buying CCP when it was trading $1 and average down all the way to 60 cents because I have prior knowledge of the business and I know it very well and as people sell I buy up
When it tank all the way to 40 cents I didnt care as I done with buying and it happen to be at 60 cents and that all I want to allocated to this stocks. I know it worth Far far more than the market selling it for.
I spent 30% of my total portfolio to accumulate CCP.
I hold it thick and thin for last 2 years I haven't sold one share after 3 baggers.
Was I nervous when it tank to 40 cents? yes but I wasn't losing sleep over it because I have strong conviction in the stock and I done all the research I can and I know more about the business than average punter and I know their trouble can be overcome with discipline and conservative approach in buying and collecting debt.
I did the same with FLT :-) People dump I buy but only when I know details about the stocks ..I dont buy many stocks I have only a handful but the handful I can sleep well at night.
and I did the same thing with CAB some 6 months ago..CAB only has a modest return and only time will tell :-)
NOD Price at posting:
32.0¢ Sentiment: None Disclosure: Not Held