Latest News Question
Should I hold on to my Citi stocks?
Cut my loses or should I hold on to it?
Best Answer
506 points
John answered one month ago …
I think based on the answers here you will probable be better off holding on to Citi. But that also depends on your initial price and your current losses.
A few months back while Citi was tanking every one was screaming how cheap it was, and that it was a good buy at this price around $20-$22 a share. Obviously not a good bet. Now the crowd is saying run while the stock stands around $16 and the stock has leveled in this area for awhile. When the crowds starts yelling sell your probably looking at a buy.
Although there maybe some remaining room for more housing and sub prime losses the housing crash is starting to level off. The sub-prime mess was nasty but it was an event that will probably not be repeated. Citi wasn't the only one to play the game, and if you take away Citi's sub-prime woes, the company has always been strong and will remain a major bank. As the Citi remains to pay a small dividend, and the markets look bearish, most investors will not be reaping big rewards anytime soon. So stick with your stock collect your dividends and wait for the markets to rebound. I am sure most investors will agree when the economy starts to turn it around banks will be major players in the recovery.
If you are already down, during a bear market, and you believe in the companies outlook, why would you sell at a loss? Why not wait for a market upswing. People consistently make the mistake of buying a quality company high and letting the market dictate that they sell low. If you are an investor and you have done your research don't follow the crowd. The key is to buy low (during down market) and sell high (during bull market) not the other way around.
Answers
2649 points
EthanR answered 2 months ago …
Depends on how long is your time horizon. If it's short or intermediate term(weeks to months), I would say sell. But if it's long term (years), I would say hold. C has been down before and come back big. In 1997 it sank as low as 13.29. But 14 months later it was up to 26.12. Three years later it was in the 50's. The big company stocks on Wall street have their dog times, but they almost always come back. For further information, see my article in TheTycoonReport.com tomorrow. It covers that very subject.
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170 points
MichaelShulman answered 2 months ago …
Citigroup's recent announcement of more write-offs than anticipated shows that for the long- and short-term, this company is a mess. Going forward, Citi's exit from the European bond underwriting marketplace will cost it hundreds of millions in future profits.
When otherwise-perfect Goldman Sachs said it was wrong to call a bottom in consumer discretionary spending and banking stocks eight weeks ago, it's something to note. Goldman reversed its positions in these groups and said to sell (which also means to short them).
There's a lot more bad news to come, especially with earnings from major money center and investment banks up ahead.
399 points
rvilmur answered 2 months ago …
I would cut my losses as the 1-2 year outlook for C is grim. They are still hiding losses that will come to light over the next year. It is now a shrinking company and will take many years to rebuild.
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303 points
MoresbyChief answered one month ago …
I bought a small amount of this stock 18 months ago with a 10 year + time horizon. Against my better judgement I did not implement a stop loss, and just watched it slip and slip, to the point where I am now down 60% or so. At this point, I am holding and in the next 6 months or so will probably be adding more to this, and probably also to a broader Finance ETF - probably dollar cost averaging into this over the next 12 months.
So to echo Ethan's comments, it all depends on your time horizon. If you're in it long term and can stomach further falls of 10-20% then hold on and consider adding to your position gradually on further weakness.
296 points
jester112358 answered one month ago …
Sell it on any brief rally. This one is going down big time and will be selling for less than $12 in a few months. Only buy companies that can generate earnings, not losses.
Disclosure: I'm Short C (hold Jan Puts) and most major investment banks.
104 points
o2pilot answered one month ago …
Do you think BAC is a good investment at this time, especially when it is paying an 11% dividend?
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2030 points
MNSL answered one month ago …
World can not run without financial sector. However currently public have lost confidence in this sector due to following reasons.
Some financial companies in some countries cannot pay debenture holders not only their principal amount but also interest for their debentures. Poor investors and savers have lost their entire life savings money due to these financials institutions and mismanaged property developers.
Some banks and funds have frozen their funds now. Public can not withdraw their money
Some banks cannot forecast interest rate movement, currency movements and market movements correctly.
These so-called top investment banks and banks did not release reports when property market was overvalued in 2005. Now they say property market is overvalued by more than 50%. In some country, it is more than 70%. These banks were very much bullish on the housing sector just similar to commodity sector now.
During this bubble period, they lent more and more credit to property developers. In some countries, they cannot sell their property half the prices of their purchase price and they are unable to meet their loan repayments to the banks and financial companies.
Some banks and financial institutions cannot recover their loans now. These will end up as bad loans. Only outstanding Banks, financial institutions will make profits in the next 02 years. We have to wait and see how these banks are going to improve their balance sheet in the next 02 years. Of course, some banks will recover in some point.
Most banks are not concentrated on the core businesses and they are trying to do almost everything now. Therefore, we must be very careful in selecting banks and financial intuitions in the future.
Finally, sentiment has to improve on this sector and there will be outstanding investment opportunity once pass the present credit bubble during next 03 years through out the world.
