I think most people will choose to sell the profitable fund first and leave the loss-making fund, because the profitable fund will bring you income, and the loss-making fund can wait for it to slowly recover or even pick up. If so, you have fallen into disposition effect.
Disposition effect said that when trading stocks or funds, investors tend to sell the profit part and keep the loss part. In disposition effect, many investors will make wrong decisions. Why do you say that?
If you have a fund that has made money, then you think you can settle down early, so you choose to redeem the fund and then buy other funds that you think have investment value. First of all, this led to the wrong habit of day trading in fund trading, and also broke the process of compound interest accumulation of high-quality funds, ending the fate with the original high-quality funds.
At the same time, under the disposition effect of intraday trading, you continue to sell high-quality and profitable funds and keep funds with poor returns, which leads to the destruction of the original fund allocation structure and changes from balanced allocation to heavy position game. If these underperforming funds continue to deteriorate in the future, the losses will be even greater.
Personality effect is the weakness of human nature. In order to overcome disposition effect, it is necessary to make a reasonable and objective analysis of funds, continue to profit from funds with excellent performance, keep a cautious observation on funds with poor performance, and never blindly sell high-quality targets. Insist on seeking truth from facts. If you choose the wrong fund from the beginning, the performance of the fund has been poor. You should correct your mistakes in time and sell what you should sell.