How not to catch a "falling knife"?

[Bibi]

When the hospital is full of pp seeking "hand" treatment. When people gave up hope of stock recovery. Are most shares at steep discount? Do you think DBS at $13.5, KepCorp at 9.6+, C&C current share price cheap? I certainly dont think so. Some (adampak, cheung woh) hv reach below fair value, but there is a reason for those. Are their latest result good? If one is satisfied with 6-7+% yearly return it might be a good time to purchase slowly. I am very greedy but patient. I want 100% return.

[camelking]

dxdy, think forumer brt77 is asking how not to be stab by a falling knife whilst purchasing the discounted stocks.

My answer is to do so when the price stop falling.

How do you know when the price will stop falling???

When nobody talks about stock...
When your hands tremble while keying in buy orders
When it seems like it is the end of the world
When retrenchment is the norm

Still u must split your purchase into 3 or 4 batches

and keep 6mth worth of living expenses for you and your family

[Temperament]

dxdy, think forumer brt77 is asking how not to be stab by a falling knife whilst purchasing the discounted stocks.

My answer is to do so when the price stop falling.

How do you know when the price will stop falling???

When nobody talks about stock...
When your hands tremble while keying in buy orders
When it seems like it is the end of the world
When retrenchment is the norm

Still u must split your purchase into 3 or 4 batches

and keep 6mth worth of living expenses for you and your family

What you said may be true but will it happens?
And when it happens, where is your money gone to?
No matter what i do, i always seems to buy and sell too early.
(This time i seem to sell too little too late. Only sold about 40%).
The crux of the matter is i am still O. K. - overall.
Because so far so good my money in the stock markets can wait till the cows come home.
And the stocks i choose are O. K. in the long run.
And i don't make too many mistakes choosing the wrong counters to ride out the with the Bear until i see the bull.
Ha! Ha!

[sgd]

how not to catch a falling knife hmmm ... let me offer my 0.01cts

best buy with your own money because the people who can do this are the big finance companies and they already "pakkat" (agreed before hand) they going to short the whole region or the whole world. So you better dun use your margin account, use own money allows you to buy on opportunities and wait it out in safety, patience is the key after enough selling markets will become "attractive" again and recover or news will arrive that QE3 or some bailout is coming.

I found a many good "mis-priced" gems in the last several days of the market panic looking for more.

good investing buddies

---

gold seems to be setting itself up for a nice correction.

For one thing the russians have been happily selling into the strength of the gold market I wonder who else might be looking to do the same.

if not careful may find themselves catching a "golden knife" instead yikes

[valuehunter]

I suppose in the midst of the selloff in the market, we have to take a step back and ask ourselves what is the role of the market? If it is to provide a quick and convenient means to own a part of listed companies, then the best time to do so is when there is a big sale. Afterall, short of the world ending and hence ending the notion of shares ownership, there is simply no reason not to buy into good businesses when the rest are panic selling. After all life goes on and the world will not just go kaput.

[violinist]

People are catching falling knives all the time. Otherwise, who do the sellers sell to?

[Big Toe]

Mr Market is an unpredictable fella, no one can accurately call a bottom or top consistenly.
No point trying to predict market movements. So long as the company you have invested is sound with
stable profits/cash flow and that you have purchase it at a discount, just wait for the market to normalize.

Also when there is panic, there is no telling how low it will go.
Just when we think it is as low as it can go, it hits you with another historic low.
We have seen this played out too many times.
But there will be a time when the index will break its historic highs as well.
Patience is what we all(including myself) need.

[pianist]

People are catching falling knives all the time. Otherwise, who do the sellers sell to?

in a market like this, some sellers might not be real because they (shortists) sell high first buy back lower later...so some real sellers unknowingly follow-suit in the panic. result is - real sellers cut loss, shortist make money. and the one bought back from the 1st seller might be a shortist himself covering his earlier opened sell position. so there are many 'imaginary' buyers around.

[brattzz]

shortist makes the prices go down! smart money pick up good quality stock!

[jeremyow]

Look out for contracting transaction volume and declining momentum of drop in share prices. When transaction volumes contract significantly and prices stabilise, less sellers and buyers are out in the market. This may signify a more stabilised state. Prices may lie, transaction volumes do not. Transaction volumes speak of the sentiments of market participants. Watch out for significant contraction in transaction volumes (especially on lesser decline or no more decline in prices) over a sufficient period of time before arriving at any meaningful assessment of the market sentiments. No point fighting against the intense panic selling by market participants (thus catching a falling knife). A winning battle goes only to the most patient who strikes only when conditions become favourable to facilitate winning. Create conditions and opportunities favourable to oneself and only engage in a battle that provides the most likely chances of winning (in context of battle, this means having overpowering strength in number of soldiers than enemy, soldiers are enthusiastic to fight and win the battle, soldiers are well-trained for battle, soldiers are well acustomed to the terrian and climate conditions for fighting the battle, ability to occupy favourable spot on terrian to fight enemy and finally understanding the enemy well in knowing the enemy is not prepared to fight and only engage such an enemy that is not in a good condition to fight and thus destined to lose a battle).