>I am considering buying tlab because it has gone down so much.
I bought WDC after it fell from 55 to 41 for the same reason.
Then it fell in a big crash to 24. I bought more. (cuz it was
'on sale', so I thought). My avg cost is 30.xx. Now it goes
for < $10/sh. I'm NOT equating WDC and TLAB - but if the
trend is down, don't buy it! Wait until it stabilizes, then
starts to reverse itself by going back UP. Doing that will
minimize the chances of repeating what I did w/ WDC.
I also bought DELL, after it went up a lot in Feb on good earnings
report. If you look at Dell's price action from Jan 1 to Feb 20,
1998, it went up a LOT. I bought anyway, at split-adjusted $31.6875
(it was really 126.75, has split 2-1 twice since then) - my stock
is up about 87% in < 7 months. I'm also not equating Dell and
TLAB - but generally it is better to buy when the trend is up.
(I did not yet realize this when I bought WDC, the lesson is/was
a hard one...)
I've seen you on the Dell thread, so you probably know about
this example of "the opposite of going down".
>I know next to nothing about the stock.
Then by definition, it would be a poor idea to buy it. The more
you know about something, the better you are able to evaluate
pros and cons ON YOUR OWN, without relying on other people who may
or may not have the same investment goals, motives, etc that you do.
Learn about a given industry, and the companies in it, etc, in the
trade press for that industry, not in the investment-specific
publications. These non-biased sources of info are generally best -
by 'non-biased' I mean, they aren't trying to sell you anything
(a stock). |
