Buy on the cannons, sell on the trumpets.

A lot of investors seem to be making the same big mistake.

Have you ever heard the saying, “Buy on the cannons, sell on the trumpets“?

I was reading a topic thread on Facebook the other week when one of the commenters mentioned an online dating website that he was looking at investing in. He was impressed with the company’s solid earnings growth over the last few years, so decided to take a closer look.

When he peered into the latest results, his initial enthusiasm dissipated. Instead of seeing an increase in revenue, as he was expecting, he saw a sizable drop. What he thought was a strong, stable growing company turned out to be a company that had just run into a major problem.

Do you pass on companies going through major problems?

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