“I can't sell this now — I'd be locking in the loss.”
What's happening
Losing something hurts roughly twice as much as gaining the same amount feels good, so people avoid selling, rebalancing, or admitting a decision didn't work out — not because the future case is strong, but to avoid feeling the loss.
A financial example
A stock is down 30% from what you paid. The relevant question is what you expect it to return from today forward, compared with the other investments you could own instead. What you originally paid is already in the past. Holding mainly because you want to “get back to even” lets that past loss influence a decision that should be based on future returns and opportunity cost.
A better question
If I had cash instead of this right now, would I choose to buy it at today's price?