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Taking Advantage Of Stock Weakness

Posted on the 23 April 2017 by Smallivy

Interesting post from Girlvestor below. This shows the issue with trading based on news. I’m sure many people heard about the United Airlines treatment of their customer and reacted by selling the shares. The issue here is that the news is already out there, so the effects of the horrendous United customer service are already priced into the price of the shares before you are able to hit the sell button. Often these things get overdone, however, so you might be able to take advantage as Girlvestor did. Often the shares will trade way down to start and then recover a lot of the loss the next day. I wouldn’t recommend buying and selling this way to make quick profits, but if you’re already setting up a position, it may make sense to take advantage of such events to add a few shares.

Taking Advantage Of Stock Weakness        Taking Advantage Of Stock Weakness

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By now, everyone has seen the #UnitedAirlines passenger removal fail! If you missed it, or have completely forgotten about it, let me refresh your memory. United Airlines had a flight leaving from Chicago O’Hare Airport that was oversold. If you’re not sure what oversold means, it’s when the airline sells more tickets for a flight than there are seats. In this case, United had crew members that needed to get on the flight and they had to take 4 revenue paying passengers off the airplane. Side note: Believe it or not, before my current job I worked as a gate agent for United Airlines. Airlines oversell their flights all the time, operating under the assumption that there will be no-shows, or people who don’t show up. I’m not taking a position for a against United, I’m just telling the story people.

Back to the story, United asked for volunteers to…

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