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Why 15% Drops Aren’t Always a Sign to Sell Stocks

These examples show how strongly stocks can bounce back after 15% dips

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Tesla’s (TSLA) stock dropped by 15% on November 6 after reporting Q4 guidance that investors felt was a little weak. In the blink of an eye its stock went from $176 to $151. Was that a buying opportunity? I thought so. Since then, however, TSLA stock has been as low as $116, suggesting investors aren’t convinced.

moneybuysellFor the long-term (3-5 years), I believe those brave souls who bought immediately after the drop will be handsomely rewarded. To prove my point I’ve found a few examples of stocks that experienced large, short-term hiccups (a 15% drop in single month of trading) only to recover nicely.

Buying sound companies on big dips strikes me as the Warren Buffett way. If you do this for an extended period of time, you should come out a winner.

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