Cheers mate, averaging down is an important part of my...

Cheers mate, averaging down is an important part of my strategy.

Averaging down needs to be combined with risk management. One day, sooner or later, especially if you were to engage in it over a period or time, you could find yourself averaging down on the proverbial falling knife- that falls all the way.

I look at finance and insurance company, no names here, that got hammered at a royal commission- that used to be over $20, even more, back in the day and now moves up and down either side of $1. Imagine averaging down on that over the years.

So my strategy is to not go overboard on the first buy- keep it to a sensible percentage of the overall portfolio- take a deep breath and redo the research before investing further- and not too close to the original buy in. And, never ever, 'go all in'. Something like that.

The market was going to be ugly today- so I took a dog for a long walk at the open- then found HCW was being set upon with shovels- and in my opinion it was the best bargain in a large field of bargains today.

Tomorrow, the market might get belted again, or it might be the start of an unending rally, but either way- I just control what I can control.

IMHO DYOR