Buying And Selling Technology Shares On Sentiment

Discussion in 'General Trading Discussion' started by longtermbull, Mar 23, 2019.

  1. longtermbull

    longtermbull Administrator Staff Member

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    In theory, the best time to buy technology shares is when markets are depressed and sentiment is low. This means that the “premium” often afforded to technology shares disappears and they can be oversold. The best time to sell technology shares is when investors get “carried away” and there is a premium on the share valuation. This works best with loss-making technology shares. Discuss…..
     
  2. gowiththeflow

    gowiththeflow Senior Investor

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    This is the only way to make money of tech shares which are all jam tomorrow. It is easier to sell a story about the future when the company is loss making - when they move into profitability then you have tangable figures to use to value the shares. The conversion from loss making to profitable can be one of the more dangerous moves :)
     
  3. Buyonthedips

    Buyonthedips Senior Investor

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    You have hit the nail on the head. It is easy to sell the "jam tomorrow" stories for companies which are loss making. There is not much to value them on except "potential" and that will move with markets and sentiment. When they move into profit, well that is a whole different ball game :)
     
  4. longtermbull

    longtermbull Administrator Staff Member

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    There are many many companies which have promised the world yet failed to deliver - leaving investors out of pocket. Its very easy to sell a dream when nobody can question what you say with any great confidence. The company may become the best in the world then again it might crumble and die. The Bettamax/VHS battle years ago is a prime example.
     
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