Definition of 52 Week Low
If you are familiar with the stock market or have some prior information, you must know that the prices of securities and shares are always varying in the market. As a shareholder and investor you should know the highest as well as the lowest prices of the securities at a certain time in the market.
For the sole purpose of this, there are certain terms used to indicate these values. 52 week low, is one such term.
What is 52 Week low?
As we already discussed, the price of commodities and securities in the stock market are recorded at both highest and lowest points.
When a certain figure is recorded as the lowest price of the stock or bond over the past one year, that is 52 weeks, it is known as the 52 week low. This 52 week low is one of the important parameters which is looked at by the investors before investing in that particular stock.
As an investor you should compare the current prices of the bonds or shares with the 52 week low before making the final decision of whether or not to invest in that stock. The future price of the stock can also be determined by the 52 week low of the stock.
Should you buy a stock at a 52 week low?
Many investors prefer to buy undervalued stocks, as it is believed that there is a high chance of such stocks to go higher in the future. For such investors, selecting a company from the 52 week low list randomly and merely based on the 52 week low information may work. However, it is a risky bargain that you must be willing to make.
It also may be a tricky choice to choose a company from the 52 week low that you think will survive the market and rise high in the near future. This puts you at a certain amount of risk.
However, if you are willing to take those risks and believe in your knowledge and instincts, buying a stock at a 52 week low may prove to be beneficial in the future.
