One Up on Wall Street
Over the course of the last few weeks I have been reading a book called One Up on Wall Street by Peter Lynch. A point that has been stressed repeatedly in this book is that you should not trust your instincts.
For example, when you see a stock that is approaching a 52-week high, most people would think to sell it. They would say: "What's the likelihood of it going past this 52-week high?" However, in some cases, that is wrong. If the company is performing very well, for example, then it is likely to push past its high. There are many factors that go into when you should sell stock.
Another example is that when you see a stock that is approaching a 52-week low, most people would think to buy it. They would say: "I'm getting a stock at bargain price, and when it goes up, I'll earn a bunch of money!" Like the other example, this is sometimes wrong. You should always check the news and the company's information before buying the stock. What if the company is going bankrupt and the stocks are plunging? What if their latest product is a total flop? As you can see, there are also a lot of factors that go into when you should buy stock.
I have learned quite a lot from this book, and I look forward to reading more about stock trading!
For example, when you see a stock that is approaching a 52-week high, most people would think to sell it. They would say: "What's the likelihood of it going past this 52-week high?" However, in some cases, that is wrong. If the company is performing very well, for example, then it is likely to push past its high. There are many factors that go into when you should sell stock.
Another example is that when you see a stock that is approaching a 52-week low, most people would think to buy it. They would say: "I'm getting a stock at bargain price, and when it goes up, I'll earn a bunch of money!" Like the other example, this is sometimes wrong. You should always check the news and the company's information before buying the stock. What if the company is going bankrupt and the stocks are plunging? What if their latest product is a total flop? As you can see, there are also a lot of factors that go into when you should buy stock.
I have learned quite a lot from this book, and I look forward to reading more about stock trading!
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