Stock Markets Exposed
Question about short term Circuit City stock buy?
I am a buy and hold investor personally. My good friend, who is young and can afford toplay the market with some of his money just purchased 400 shares of circuit city stock. I personally do not like the company or its long term outlook. He however has been doing some research and feels the stock will go up from its current low during the holiday buying season and plans to sell sometime nov-jan before it comes back down. Has anyone else heard of or done this? What is the best time to sell this stock which is obviously not a long term performer? What news should he look for when determining to sell? The company is 93% owned by institutional investors which is good for his situation.
Public Comments
- NOOOOO Better to go with Best Buy, Cosco, even sears Circuit City is worst in their class
- I think your friend is making a serious mistake. For starters, the premise is flawed. A quick glance at a long term chart shows that this is not a seasonal stock; it has never shown particular strength in the Christmas run-up. Why should this year be any different? Next, the timing is clearly not right to buy this stock. The stock has been falling steadily all year and is right now at its 52 week low. Tell your friend, 'bottom fishing is an expensive hobby!' If he buys this stock now he will get burned! In fact, it looks like a great SHORT candidate! And as you pointed out, the long term outlook for Circuit City is not so good these days. The economy seems to be slowing down and there is serious doubt about the strength of the retail market in general. Furthermore, the fact that there is 93% institutional holding of Circuit City is NOT GOOD FOR YOUR FRIEND'S POSITION!!! Those institutions are apparently dumping their shares right now by the performance of the stock recently, and as they dump there is NO WAY retail investors are going to absorb the selling. This stock is headed to $5 a share before Christmas, and I hope you can talk some sense into your friend before he looses any more of his money.
