Larry Bird and prospect theory

I hate to lose more than I like to win.  - Larry Bird 

This single statement tells us almost all you need to know about prospect theory. If it applies to Larry Bird during his playing time, it applies to most investors. We have marginal falling value from gains and marginally increasing aversion to losses; however, the key is knowing that there is an inflection point or what can be called the adaptation point which is usually at the price that the asset is bought. The starting point matters. Our willingness to hold losers and sell winners is based on the starting price.