Ask Colin

I find it hard to get set at the previous closing price. How do you set buying quotes at the start of a day?

On entering next day, you have to realise that the market is dynamic. It is affected continuously by news and rumours. It is also affected by the emotional or rational response to what happened the previous day. If you think a stock is a good buy, so will others. I don't expect to be able necessarily to be able to buy at the previous closing price. In fact, I think it is a good thing if I have to pay more - it indicates that the stock is strong. If I can buy below the previous close, it could be a bad sign. Nevertheless, the opening price is often an emotional high or low and reflects what the greediest or most fearful investor thinks. I find it is often a good move to let the market settle after it opens, before acting.

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