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To Find Winning Stocks, Investors Often Focus on the Laggards. They Shouldn't.

·1 min

A common mistake made by investors is focusing on underperforming stocks instead of targeting top-performing ones. These underperformers often have valid reasons for their decline, such as deteriorating sales and earnings, market-share losses, or mutual-fund managers adjusting their positions. Investors should be cautious when considering stocks that appear to be on sale after a period of weakness, as there may be underlying issues affecting their performance.