Stocks at 52 weeks low- Excited or worried?
Happy to know that you have enjoyed our article “trading-based-on-news-channel-tips“. Let us upgrade our skills to realize our dream of making profits from our investment decisions.Historically it’s been proven again and again that another great way of losing your money is blindly buying 52 week low stocks in anticipation of bounce back and quick money.
52 Week Low stocks spotted: What to do?
Next time before buying any 52-week low stock in a jiffy make yourself calm and composed and ask yourself the following questions:
What is the rationale behind buying based on this strategy? Have you figured out any mechanism and how it works?
How do you ensure further selling will not come at those stocks @ 52 weeks low?
How do you decide buying will come at the price where you want to jump in?
Have you backtested your approach of picking the stocks based on Buy low @ 52 weeks low – sell high, and make quick bucks on your investment?
Finally, if your method is convincing to you, do you have the statistics to prove that it’s having an edge to earn consistent money successfully?
Still wondering, how do you know that all these players (FII/DII) will buy at @52 week low Level? Remember, the price can take the turn from 52 week low levels, only if it gets the enough buying support by smart money.
Paper trading 52 week low stocks buying strategy
“Alas, it never came to my mind, because I was overwhelmed in claiming to my friends, how I made quick bucks buying 52week low stocks and I am lucky”. If you are one of these types of “Get Rich Quick ” guy, who is riding on luck, without enough effort during stock selection, then our humble request to you is, kindly do some paper trades for next few months by buying 52 week low stocks and analyzing whether you made money or list of money in the process. Definitely, the path will be painful and unemotional, as no real money is involved. Statistics will help you to realize the outcome of your method and give you a relief in a greater manner.
Still, some of us may think that who will waste a hell lot of time and opportunities in paper trading. If you find this is ridiculous to explore for the benefit of you here is a masterpiece for you.
Are you lucky enough to survive?
Anonymously I take your approval that Mr.Usain Bolt is one of the greatest and the fittest athletes in the world. I do not wish something bad to a great sportsman. Hypothetically let us assume that he falls from 2-3 floor building (assuming he will be alive after the fall). To start running again, Usain Bolt needs a few days/weeks of rest. Of course depending on the severity of pain. On the same analogy, any good stock needs time and great money inflow of buy orders to trade again at higher levels after making a 52 week low. Arguably even if it doesn’t fall further, it might take some time (usually 1-2 years) to trade higher. In this case, are you prepared mentally and economically to lock your fund your for 1-2 years without much profit!!
I take this opportunity to request you to handle your hard-earned money wisely. Wish you great investment opportunities ahead!
I am grateful that, Credit of Original Idea of the article goes to Mr.Indrazith. He is a full-time trader who helps retail investors learn about the market.
PS: I personally mentor enthusiastic people who have their dream to become the full-time trader. Are you keen to know how to make money from Investment/Trading? For simple yet powerful methods contact me