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Fundamentals, page-79

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akgo01

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21/04/22

21:11

Post #: 60956810
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Originally posted by AOF: ↑

..."I have read and heard many times this gem no 3 from @AOF above. Can anyone explain to me what and when exactly I have to do besides feeling the fear and the greed? Thanks"

It's not actually my own, "Gem" akgo01, I ..'borrowed it' from "the Oracle" aka, Warren Buffett.

But, basically, it means, avoid paying for 'overpriced' Stocks, when they become, ..'the flavor of the month', ie, when every man on the planet, and their dogs, as well, are all ..desperately, wanting to own them, and all willing to chase the SP of them, ever, EVER upwards.

Instead, ..just ..wait, until the market has one of its inevitable downward, turns, the bigger the downturn, the better, and everyone, (make that, nearly, everyone) is seemingly losing their minds, and literally trampling each other underfoot, in their frantically desperate races, ..for the EXITS..!

Another old way of saying the same thing, is, .."Save your buying, for when there is blood in the streets"..!

This, of course, is a strategy that is 'best suited' to LONG HOLDERS, of any, Stock, who have already mastered, what is often, the hardest of all things, to learn, ie, ..their ..own ability to ..be ..PATIENT, and, not so much, suited, to those folks who like to 'frequently' Trade Stocks, ..although, if you have 'mastered Trading' then it can also work for you as well, just not usually on the same scale, as the less frequent buying forays of us Longs.

All that is required is ..PATIENCE, and the willingness, to use the times between any such downturn buying opportunities, to horde, your money, while awaiting the next chance, ..to spend it.

As the old saying goes, "Understanding the Stock Market is very simple, ..BUY CHEAPLY, and ..SELL HIGH"...!

And, if you're like me, ..HOLD 'em ..TIGHT, Folks...!!

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AOF, thanks a lot for your explanation.

I was thinking about it all day, and just now it occured to me that this gem is really an advice on how to trade. It fits better to trading strategy than buy and hold.

Be fearful, when others are greedy: as you said, don't buy when others are greedy buying, but be fearful of the falling share price after the buying finishes. So sell when others are greedy buying.

and be greedy, when others are fearful: then be greedy buying when others are fearful or in your colourful words: when "everyone, (make that, nearly, everyone) is seemingly losing their minds, and literally trampling each other underfoot, in their frantically desperate races, ..for the EXITS..!"

Are you sure Warren Buffett is not a closet share trader?

AKE Price at posting: $13.10 Sentiment: None Disclosure: Held
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Fundamentals, page-79

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