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"Buy low and sell high", while sounding good, is generally terrible advice since you only know what was "low" and "high" in retrospect. A stock (or an index, in
by breezeTrowel 3y ago
"Buy low and sell high", while sounding good, is generally terrible advice since you only know what was "low" and "high" in retrospect. A stock (or an index, in this case) might hit a new low only for the price to crash even further. The same thing goes for highs. A stock or index making a new high may very well continue to rise.
So, instead of "buy low and sell high" it tends to be a lot easier to "buy into strength and sell into weakness".
- momirlan 3y agoit is actually easy to figure "high" and "low", based on price vs value of a certain stock. Warren Buffet has been doing it for a while. most people don't have that discipline and prefer momentum.
- breezeTrowel 3y agoCorrect me if I'm wrong but wasn't Warren Buffett an activist investor who'd find undervalued stocks from companies that had poor management and, once his partnerships gained enough control, fire the current management and replace it? Sounds like a far cry from "buy low, sell high".