Yes of course the average buy in price would be higher however seeing as the probabilities of it continuing to move higher ie with the trend is alot higher than bottom picking. its a lower risk/higher probability trade. Not saying its fail proof im saying its alot less risker.
Im confused....You think ppl that have averaged up in the past held all the way down? Wouldnt use stops? No risk management? That seems highly unlikely.
Its about placing trades when the odds are in your favour. The very basic premise of trend following, playing ranges etc.
LYC doesnt move fast. There would be no excuse not getting out when the trend changes (ie the 123 patten) Sure you give some profits back but its not about picking top/bottoms its catching the meat in the middle. Theres absolutely no reason whats so ever for anyone to have held all the way down. None.
Something to ponder:
http://www.nusinvest.com/wp-content/uploads/2013/01/6-stages-of-a-typical-trader.pdf
average down - lyc, can it work?, page-122
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Last
$6.11 |
Change
-0.180(2.86%) |
Mkt cap ! $5.711B | |||
| Open | High | Low | Value | Volume |
| $6.12 | $6.15 | $6.07 | $17.65M | 2.889M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 5 | 26354 | $6.10 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $6.15 | 3758 | 2 |
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| Last trade - 16.10pm 02/08/2024 (20 minute delay) ? |
| LYC (ASX) Chart |