Quote from Rabbitone:
Never act on tips. You may get one that works. That is the worst thing that could happen. Because the next tip you take could crush you.
Two of the worst equity trades I ever made were quite a long time ago on tips :
1. Someone working in a large retail chain that had been in
business a long time was touting their company stock to
everyone at our sports club. They were deadly serious that
it was a strong rebound candidate. I bought some shares.
A month later they went insolvant, and the guy was out of a
job.
2. Someone on my sports team was touting two Companies,
one of which was a local company trending up. Seemed like
a growth candidate. So I bought some. Still have the shares
many years later, but they were delisted and worth almost
nothing, their fall from grace was spectacularly fast.
About three months after buying this company I noticed a
relative of the touter was a major executive at the firm.
One of the worst misses I had was in the 1990s, when I was considering IBM. I got talked out of it by one of the guys excited about gold stocks, especially juniors. The whole group there were gold bugs in there spare time. I bought a miner instead and made a little ( it was late in the game for that hot sector ), then watched IBM split and go up 200% in 1-2 years.
The lesson I learned is tips are rarely good, and generally come from people without trading skills. It would be like shorting the S&P 500 with near term puts every time GrandStuperCycle posts "I urge caution. Major correction is imminent". You'd go broke within 3 months listening to the guy. I had to laugh at the Wile E. Coyote reference. Because everytime that character gets squashed, he comes back. Maybe that works for today's market, dozens of fake corrections and it always rebounds within days.
I suspect in the fall though it will be the "Road Runner" Rally again.
AND with valid reasons, did I listen? Nope.