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Capitalist

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Capitalist

Re: newbee03 post# 19067

Wednesday, 03/01/2006 10:59:14 PM

Wednesday, March 01, 2006 10:59:14 PM

Post# of 47150
Hi newbee03,

Your question, although "really basic" is an excellent one because it brings out a very fundamental truth about market strategies. So here's the basic answer:

There are two opposing schools of thought in strategy; Momentum vs. Contrarian.

The Momentum school says "the trend is your friend". They buy stock when it's going up, and sell it when it's going down.

The Contrarian school says "what goes up must come down and vice-versa". They buy stock when it's falling and sell when it's rising.

Your friend sounds like he subscribes to the Momentum view. AIM is definitely on the other side of the fence; firmly in the Contrarian camp.

Hope this helps!

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Visit the crew at www.investorshub.com/boards/board.asp?board_id=5125 [tag]The_FOREX_Traders_Board![/tag]


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