Excerp from a post on another SI thread that expands upon
another fav issue I've posted about, from time to time, during the years I've been on Silicon Investor. Commonly know in the biz as <catching falling knives>, it entails buying declining stocks and continuing to average down (instead of cutting you loss, getting out of a loser and moving onto a better opportunity).
I've referred to it as <Safe Catching> because I think the image better represents the pounding I've seen people take in some of these stocks. MIR (pitched here by a "visitor" not long ago) is the most recent example. It went BK about a week ago and it's likely that stock holders will zero out.
Anyway, here's the excerp referring to these kind of high debt, high risk stock plays and the level of savvy of the people who pump them on the web.
Isopatch
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<From my perspective, buying as the price is still falling is "NEVER" a good trading strategy. I have been researching the buying and selling strategies of some of the world's best traders, and NONE OF THEM buy a stock with the price still falling. NONE OF THEM!
None of us would invest our money with a money manager that bought weak stocks while prices were falling. I'd love to see that brochure!
"I'm going to invest your hard earned money, in stocks in a weak sector with lots of bankruptcy possibilities, and I'm going to average down in my buying points. If we succeed, we're rich. If not, there's always more money where that came from, I hope. Keep them hard earned dollars coming my way!"
I wonder how much money would come our way?
Most of us would be fired as money managers if we invested other's money the way we invest our own.>
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