Oluwasegun purpose
Active member
There are many attitude toward the movement in the price of a stock......
For example some claim that if the price of the stock starts to fall it will continue to do so ,whereas if the price of a stock starts to rise it Will continue to do so as well.....
On the other hand,others hold the more optimistic view that every fall of a stocks price Will be followed by a rise ....
Generally investors try to forecast the movement of stocks in a particular direction...those who believe in the first claim will immediately try to purchase the stock when they see that it has experienced a significant increase in its price...thinking that it will continue to rise for the years to come.....
However,a failure to make a preliminary research may result in losses since the price of the stock may have been pushed well above its intrinsic value...As a result the investors who were the first to purchase the stock may sell it and enjoy their profits,leaving you with painful losses
Once you are familiar with the company's business you will be able to forecast whether the problem that has occurred will be solved...However,you should not wait too much time for the correction if the chances of fixing the problem too late..you should carefully consider the potential of the management to deal with the difficult conditions that have arisen....
Finally,avoid considering the cureem direction of a stock as a movement that will continue forever...study the company's business activity in order to determine whether this is a current state or a consistent losing position in it .....
For example some claim that if the price of the stock starts to fall it will continue to do so ,whereas if the price of a stock starts to rise it Will continue to do so as well.....
On the other hand,others hold the more optimistic view that every fall of a stocks price Will be followed by a rise ....
Generally investors try to forecast the movement of stocks in a particular direction...those who believe in the first claim will immediately try to purchase the stock when they see that it has experienced a significant increase in its price...thinking that it will continue to rise for the years to come.....
However,a failure to make a preliminary research may result in losses since the price of the stock may have been pushed well above its intrinsic value...As a result the investors who were the first to purchase the stock may sell it and enjoy their profits,leaving you with painful losses
Once you are familiar with the company's business you will be able to forecast whether the problem that has occurred will be solved...However,you should not wait too much time for the correction if the chances of fixing the problem too late..you should carefully consider the potential of the management to deal with the difficult conditions that have arisen....
Finally,avoid considering the cureem direction of a stock as a movement that will continue forever...study the company's business activity in order to determine whether this is a current state or a consistent losing position in it .....