It’s pretty simple when you think about it. Buy low, sell high. Right? Well…not so fast.
Obviously, it’s easier said than done, because what is low? We know a number of reasons why stocks might fall and continue to do so over time. A number of factors depress stock prices – poor management decisions, consistently bad earnings, serial equity raises, fraud, etc. Unfortunately, investors try to ‘take advantage’ of the depressed prices of these stocks and may pay the ultimate price of their bad decisions.
However, most people don’t take into account the outlier – the one time that a superb company gets unjustly punished because it got caught up in a bear market, or there may have been news that was inaccurately interpreted by the masses, or perhaps it had ONE bad quarter of earnings in an otherwise spotless history of performing for its shareholders.
In our stock coverage universe, you can bet that when one of our quality holdings gets beaten down, that is our time to act. Thirteen years of research have allowed us to cover hundreds of stocks for our members. When the best ones fall in price for little reason, we take swift action to include it in a Pullback Model Portfolio, a portfolio intended to give us short to mid term gains around our long-term core holdings.
DON’T MISS OUR NEXT BUY ON PULLBACK MODEL PORTFOLIO
In the 7 closed portfolios below, the stocks all belonged to our core basket of stocks at the time we added them as positions in these Pullback Portfolios. We had a reason to include each and every stock in these portfolios, and we were rewarded for doing so. In every case except one, we handily outperformed the S&P 500 index, with 5 of them by at least 100%.