Billion Dollar Baby, page-77

By the sounds of it, your method works for you and that’s great and well done!

However, a casual look at say, NEA 5 year chart, would seem to imply that many people following that philosophy would have had to hold on during some very steep and long declines before they showed a profit.

Anyone prepared to invest for the longer term may be better off to buy low and hang on for the next twelve month high. Inevitably, every 12 month high is followed by a twelve month low and every twelve month low is followed by a twelve month high.

Granted some traders make money from following trends but I would wager that more investors make more money buying stocks that they intend to hold for a long time and then top up during the inevitable pullbacks that will occur from time to time. Those that bought NEA at the most recent 12 month low would be doing pretty well right now. They will get an extra kick along from those traders following trends that buy stocks when they reach new yearly highs. 

The moral is, when it comes to investing, it’s your money so back your own judgement.