After experiencing losses in the market, many investors are tempted to either freeze in fear or walk away completely. But according to Josefino Gomez, a Registered Financial Planner (RFP), those reactions only lock in defeat. The real test of an investor, he says, is whether you can use a setback as the foundation for a comeback.
In an interview with Financial Adviser PH, Gomez explained:
“You can’t erase a loss once it’s happened. But you can control what happens next. With the right plan and mindset, you can turn a painful experience into an opportunity.”
Here are the steps he recommends to bounce back stronger.
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Build a Strategy and Action Plan
Losses create emotional chaos, but Gomez believes a clear plan restores focus.
“Your big-picture outlook defines your strategy. Your action plan defines your next moves,” he said.
He suggests mapping out scenarios in advance. For example:
If you believe a stock is undervalued, set a buy-below price and add gradually as it dips further.
If you’re a bottom-picker, wait for a rebound of five to ten percent before entering.
If a position is beyond saving, cut your losses slowly at predetermined levels.
The key is to avoid clinging to bad positions out of pride. “Don’t let ego get in the way. Admitting a mistake and taking a valid loss is not weakness—it’s discipline,” Gomez said.
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Execute the Plan
Planning is the easy part; execution is where most investors struggle.
“It’s simple to click buy or sell, but emotionally, it’s the hardest step,” Gomez explained. “People freeze when their portfolios are down. Others panic and sell everything. Neither response helps.”
Discipline means acting despite discomfort—raising cash when needed, trimming losing positions, or adding carefully to stronger ones.
“The hardest thing is not the math—it’s accepting the reality of the situation and still moving forward,” he said.
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Learn to Be Better
Gomez emphasized that every downturn carries lessons for those willing to reflect.
“If you’ve been through enough bear markets, you realize the details change, but the patterns rhyme,” he said.
He advises investors to write down their insights after every crisis. Maybe you learned to:
- Rebalance regularly.
- Avoid speculative bets.
- Stick with companies you truly understand.
Crises also create opportunities. High-quality firms often trade below value during panic selling, leaving room for disciplined investors to buy at a discount. “Losses teach you to see clearly,” Gomez added. “They show you where you went wrong—and where you can go right next time.”
Final Takeaway
Setbacks are inevitable, but comebacks are optional. With a clear strategy, disciplined execution, and a commitment to learn, Gomez believes any investor can bounce back from losses.
“A loss doesn’t define your future,” he told Financial Adviser PH. “What defines you is how you respond. Use every crisis as training ground. That’s how you return wiser, stronger, and ready for the next opportunity.”
