09-17-2020, 08:06 PM
(This post was last modified: 09-17-2020, 08:57 PM by StockmanNigeria.)
What Is Average Down?
Averaging down is a portfolio management strategy that involves buying more volume of the same stock at a cheaper price when its price declines. This brings down the average cost (per share) of acquiring the stock.
For example, a StockmanCooperative bought 100,000 Units of Zenith Bank Plcshares at N20 per share. Recently, StockmanCooperative purchased additional 100,000 units of Zenith shares at N10 per share, thus bringing the average purchase price down to N15 per share.
Please note, we can only encourage any investor to deploy this portfolio management strategy only if s/he is buying and holding for long term period. In other words, accumulating more stock at a lower price only makes sense if you plan to hold it for a long period of time.
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PLEASE YOU MAY ASK YOUR QUESTIONS AS A COMMENT OR REPLY BELOW
Averaging down is a portfolio management strategy that involves buying more volume of the same stock at a cheaper price when its price declines. This brings down the average cost (per share) of acquiring the stock.
For example, a StockmanCooperative bought 100,000 Units of Zenith Bank Plcshares at N20 per share. Recently, StockmanCooperative purchased additional 100,000 units of Zenith shares at N10 per share, thus bringing the average purchase price down to N15 per share.
Please note, we can only encourage any investor to deploy this portfolio management strategy only if s/he is buying and holding for long term period. In other words, accumulating more stock at a lower price only makes sense if you plan to hold it for a long period of time.
Read More Here
PLEASE YOU MAY ASK YOUR QUESTIONS AS A COMMENT OR REPLY BELOW