If you’re buying today, the risk/reward has already shifted.
Stocks people were happily paying $100 for are now trading at $40.
That’s a 60% discount.
But the question shouldn’t always be:
“Is this THE bottom?”
You’re probably not going to nail the exact bottom anyway.
The better questions are:
- Does the company still make sense fundamentally?
- Is price sitting at a strong technical level?
If the answer to both is yes, that’s where I’d comfortable slowly adding to long-term positions.
Do note- Not every stock down 60% is a bargain.
@Math_files In your demo, the first equality is wrong. Because you assume directly that x >0. Because it will not work otherwise. That, your last conclusion is wrong, only the known values can be removed from both sides of the equations and not the variables as you did.
@naiivememe The restriction on the weight of the suitcase is not firstly to limit the final weight of the plane but for the well-being of the airport workers (bagages handlers).