Buck the Trend

When a security performs better than the general market performance or the sector’s performance. The term usually refers to good performance in the face of a general market downturn or a sector slump.

A stock that is bucking the trend may be a good buy, however as Buffett would say, “A good businessman cannot change the fundamentals of a bad business.” If the industry is in a long term decline, a stock that is bucking the trend may not last too long, or perform too well overall.  However, stocks that are bucking the trend do deserve a second glance and further research.  They may be the star of the industry in the next bull cycle because sometimes a stock bucking the trend indicates good management that was able to keep out of troubles that the rest of the industry wasn’t able to.

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