Friday, January 4, 2008

52-week low doesn't mean a BUY

I bought Broadcom (BRCM) when it hit a 52-week low of 28.75 in Nov 2007. The company had also announced a stock buy-back program. I was very tempted and bought the shares of BRCM for $1000. The stock touched a new 52-week low of 25.78 in the next 6 weeks. I lost more than 10% in 6 weeks. It was a lesson well learnt. I didn't do a proper research on the company. The market ratings were hold & avoid for BRCM :)

I am eagerly waiting to take my money back. Hopefully, the stock will break-even soon. You should never just use "52-week low" as the ONLY metric to buy a stock.

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