How Quickly the Mighty Can Fall: Netflix (NFLX)

Netflix (NFLX) is currently down on a day when the Dow is up more than 400 points.  Below is a chart of Netflix since the stock IPOd on May 22nd, 2002.  It's a glaring example of how quickly the mighty can fall. 

From its IPO price of $7.50 to its closing high of $298.73 reached on July 13th of this year, the stock was up 3,883%.  Since July 13th, the stock has fallen from $298.73 to its current price of $66 -- a decline of 78%. 

There's a common market saying that "you should never become married to a stock."  There's no doubt that there are a large number of investors out there who are married to NFLX and have riden it all the way down because they just can't divorce themselves from it.  The proper play is to set a stop price to sell the stock at a certain threshold (5%, 10%, 20%, etc.) that takes all emotion out of the trade.  If it's too difficult to stick with your set stops, then trading just might not be for you.