Lobster Bear

"Buy low, sell high" - Lobster Bear

The Lobster Bear brand represents the trading strategy of buying low and selling high, misinterpreted as buying cheap penny stocks and selling stocks making all-time highs. Lobsters eat what falls to the bottom of the sea, and bears attack at the top. This strategy suffers from survivorship bias as only charts of stocks making lows and recovering represent a small fraction of those going to zero or are delisted from the exchange. Meanwhile, stocks making all-time highs tend to keep going higher in the long term as they are either growing or consistently profitable. However, there are ways to profit from this strategy. By being a fancy lobster bear and picking the best stocks that fall to the bottom, you can find those gems like Apple and Bank of America. In addition, shorting or buying puts on weakness in stocks making all-time highs, or when there’s a market or industry specific risk event that causes almost every stock to fall, is another way for this strategy to work. A rising tide lifts all ships. The start of a bull market creates opportunities to ride the waves and catch those stocks that have fallen to the bottom, as does the start of a bear market creates opportunities to sell those stocks making all-time highs. It doesn’t end there, even up and down swings during a bull or bear cycle allow for quick profits from being a Lobster Bear.