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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Mike Buckley who wrote (22897)4/17/2000 2:20:00 AM
From: Seeker of Truth  Read Replies (1) of 54805
 
The argument against buying low and seling high is that we don't know where is low and where is high. If we just extrapolate the last year's high and low P/Es we may buy low and that may turn out to be high as the succeeding periods high and low P/E's may both be below the previous "low". Similarly if we sell at the high we may be out of the stock for a decade, when the market decides that a higher range of P/E's is appropriate. If we are true long termers then we float (up and down) through all these oscillations all the while having a gradually increasing interest free loan from the government, i.e. taxes not yet payable since we didn't sell.
I think most of us on this thread agree with the above. Those who think they can trade successfully, timing the highs and lows are IMHO doomed to waste a few years until they settle down. Ditto for margin buyers, call buyers, short sellers, etc.
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