Imagine buying the house next door for half price, would you? Junior mining stocks have been on a fire sale for some time now but why are we nervous about pulling the trigger and buying? Why doesn’t the colloquial statement ring true? “Buy low and sell high.” It makes sense, but then why do most of us buy high and sell low? Fear and panic sets in when we see our stock prices collapse. It seems counter-intuitive but buying when people are panic selling generally leads to profitability.
My PhD thesis focused on the affective heuristics of the 2008 stock market crash. Basically that investors are emotional beings that invest emotionally – both in times of highs and lows in the market. Like many, I sustained a lot of personal losses and am starting to become more aware of my ‘emotional investing patterns.’ When do I invest? What makes me motivated to buy a certain stock? Am I panic buying/selling? Have I done my research?
Being a newsletter writer, I have ‘learned’ to do more investigation on the companies I write than I would if I invested purely for myself. But in saying that, it is prudent for the investor to perform in-depth research before buying a stock. In the junior mining field that includes:
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