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Originally Posted by KCUnited
Talk to me about buying strategy.
Say you've grabbed a position in a stock using the funds available to you at the time. The stock has done well and seems to be rising. As more funds become available to you, do you a) keep purchasing the stock at the market price? b) hold the funds and set a limit order at a lower price and wait for a dip? or c) look for other opportunities with a different stock?
Also, do you have a max number of shares you strive to get to in something before you move on to a different stock?
My scenario is specific to making funds available with each pay period, every 2 weeks in my case, and I'm a little fuzzy on how to allocate after my initial (larger) purchase.
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I mess around with different strategies all the time, and haven't found one that works in all weather. I had a good one a while back for a sideways stock market, but it does not work well in a market like we had last year.
I'm mostly a buy and hold guy in the big picture because I want to understand the stocks and how they move. But recently I've been chasing momentum. I look at the stocks in my portfolio that are down each day, and if one of them has been positive over the last X months, I'll buy a smidge more of it. Maybe a 1 percent add. I do that every couple of days since I've been sitting on some cash for a while.
I'll say too that having the "reinvest dividends" button on has worked well this past year. The computer bravely invested my cash payouts during the months when I was afraid to do so.