An excellent analysis into investors’ behaviours. I’m certainly one who is always filled with regrets when I have “missed” opportunities, to buy or sell stocks when the prices are good, quite often with hindsight 🙂 And I’m not willing to cut my losses, even though it makes sense to cut them and then buy back when the prices are lower. I guess it is also to do with not knowing that the stock prices are going to be much lower. But having said that I have never cut any loss with the strategy to buy back at a lower price. Instead I always prefer to average out the positions of my stocks. This strategy can work too, provided that I have more money to pour in. But not so much if I’ve already gone all out. And I certainly agree on the Prospect Theory, as I’m one of many who is willing to take more risks when I’m losing money, although not quite to an insane level which I’ve seen some people do. Anyway if one is not comfortable about losing money, even if it is just paper loss at the time, it is best to only invest money you can afford to lose. Otherwise, be prepared for any potential anxiety over your portfolio, particularly at this kind of uncertain economic climate, when all is not going according to plans.