What is the origin of the idiom "cut one's losses" and when to use it?

The idiom "cut one's losses" has its origins in gambling and financial contexts. It is often associated with betting or investing in situations where there is a potential for loss. The phrase suggests that when a person realizes they are incurring losses or facing a losing situation, it is wise to minimize those losses by withdrawing from the situation or selling off investments before they decline further. This phrase is used to advise someone to abandon a course of action or investment that is not going well in order to limit further losses. It implies making a strategic decision to minimize the negative impact of a situation.