Usually one should exit when gripped with fear - and after you have stained your clean white shorts.
I believe the academics who study this sort of thing - say the loss side of the equation sticks in memory more.
risk reward are assymetric or some b.s. like that.
Hence I like the part where I don't look too close and the computers just rebalance away.
Norwegian widow wise - try and consol myself with the higher yield. I always buy high, sell low - that's the only way I can make money. Exception being the automatic rebalance to a prefixed asset allocation.
P.S.: Behavioral finance is hot stuff/in vogue right now. Sort of like Psst - dividends!. Things go in cycles/suffer from recency etc., etc. The Wall Street term is: feeding the ducks or something like that.