Never catch a falling knife. Helpful health and safety advice but, in an equity market context, does the idea of not buying shares in companies that have seen a material price decline really help one make money over the long term?
The complementary ditty 'the trend is your friend' has a comforting ring to it. But is the idea of continuing to buy shares at increasingly high prices really sensible? Both strategies would seemingly advise investors to disregard the so-called 'fundamentals' - the bread and butter of the bottom-up investor. Which areas of the market will see increased flows? If investing is as easy as rhyming, then my young son has a fruitful career ahead of him. The current reality is that expensive stocks are getting more expensive. Diageo, Sage and RELX are all trading at multi-year P/E pr...
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