Yes ... but to come back to the focus of this thread...I got aware of Clutch Auto (and made money ... like hundreds of others I'm sure who may have identified it thru other techniques/tips) only thru the 52 week high strategy
see my post on another thread long back ..
http://www.traderji.com/36998-post5.html
Not to say that a 52 week LOW can't turn around and become a multibagger .... but Saga, you are safer off riding the wave (and backing winners), rather than investing in a
likely loser
What say ?
AGILENT
But what if Saga spots this stk early (when say it's at a 70-80 prc lvl & languishing) Having studied the fundamentals he concludes that this is a good company that is being irrationaly discounted by the mkts at present but will do well in the long run (as in the long run mkts give each one its due).
He buys a little (in case it's noticed by the mkts & shoots up) & waits for a more opportune time to buy more. And he does get his chance during the May fall when the stock hits a new 52 Wk low (don't know if Clutch Auto actually did; this is just an e.g.). Or let's say he keeps accumulating the stk in small lots everytime it falls 15-20% till it hits a couple of 52 Wk lows.
Then today won't he be sitting on much heftier profits than someone who buys the stock only after it hits a 52 wk high?
Off course such a strategy takes a lot of courage & conviction & patience and is not for the average trader. In fact it wouldn't qualify as a trading strategy at all. Only long term investors can contemplate such a strategy.
Also it needs deep pockets & some risk appetite.
For people with less capital, like myself, the best i can envisage is allocating a portion of my portfolio for such value investing and keeping the rest for regular (momentum or whatever) trading.
Also i wouldn't insist on a 52 Wk low - but the more undervalued the stock is the better (i.e. more my potential upside & less the downside risk).
Regards,
Kalyan.
