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Buying strategies on a share price collapse..

  • 31-10-2007 11:46pm
    #1
    techguy
    Registered Users, Registered Users 2 Posts: 2,236 ✭✭✭


    Hi,

    I Began watching Broadcom a few weeks back when they were at ~$42.. I was interested in them then beacuse of their new technology.. in the last week they have had a bloodbath because of their earning and spending..
    The price still seems to be moving down slowly..when should I buy them?

    In general, how do you guys gauge something like this? I have noticed a few times before that there is usually a big drop followed by a pause and then a another drop but as steep..

    What are you're opinions on this stock? Has anybody else been watching them?
    Also, what would you say about this atricle this time round??


Comments

  • #2
    A Random Walk
    Closed Accounts Posts: 346 ✭✭A Random Walk


    There's an old saying "never try and catch a falling knife". If I was sure that a share was undervalued (and I rarely feel sure enough) I'd usually just start buying incrementally rather than trying to time the very bottom.

    That article is rubbish, humans love to think they see patterns where none really exists. Read your Malkiel if you'd like to know why none are really exploitable by the ordinary investor.

    Couldn't tell you anything about Broadcom itself, try and understand why it is falling before buying based on the new technology opportunities you see.


  • #3
    techguy
    Registered Users, Registered Users 2 Posts: 2,236 ✭✭✭techguy


    Thanks A_Random_Walk,

    I am aware that they are falling because of bad sentiment based on their earnings last week and the amount of money they are spending in R&D...
    There is a lot of talk about them lately..but i'm still unsure as i'm investing for about 10 years plus..

    On the other hand I had am thinking about CRH which I am currently down 22%.. I said to myself last week if they hit 25 again I would go in..but i'm not sure it's over yet..


  • #4
    A Random Walk
    Closed Accounts Posts: 346 ✭✭A Random Walk


    techguy wrote: »
    On the other hand I had am thinking about CRH which I am currently down 22%.. I said to myself last week if they hit 25 again I would go in..but i'm not sure it's over yet..
    I've no idea where it will end up. I've bought some recently at 30 and thought it was a great bargain, then at 27 and today at 25 :) As long as it keeps going down I'll simply keep adding as the paycheck comes in, it doesn't bother me what price the market decides to put on it if the business remains sound. Don't take this as a recommendation but personally I feel more comfortable investing in a consistently profitable company which owns rocks and stones rather than volatile technology IP.


  • #5
    techguy
    Registered Users, Registered Users 2 Posts: 2,236 ✭✭✭techguy


    You talk sense alright..and thats what i'm thinking of too.. When I started out I told myself NO PUNTS just "blue chips"..I'm thinking that crh is better long term because they pay dividends in the form of scrip too so in about 10 years I should be doing pretty well..

    I'd love to be in your postion but i'm still in college so I can't afford to dribble money into the stockmarket..it's buy and see what happens..


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