Yes, thats part of the game Mudit.
This happened for real in the case of RVNL for me in the Feb-Mar turbulence for the stock. From the Jan high of around 345, it made an intraday low of 213 and a weekly low of 237 in Feb. Now that was quite a hit but it hadnt breached my sell criteria. I infact look at 50EMA and for RVNL in particular, I had the big Jan candle as a reference where the low was 203. So I stayed put and if you see, RVNL is back in the mid 300s…
One way to think of it in the scenario you mentioned is if you have an equal-weighted portfolio, a 25% hit on one stock is less than 1.5% hit on the portfolio.
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