Chasing The Market

Chasing the market is slang for impulse buying of hot stocks, or selling stocks that have shown signs of weakness. Basically, something happens and the impulsive investor thinks that something is going to keep happening. A stock rises and the market chaser starts buying, assuming the stock will keep rising. They don't look at the company's financials. They don't make an in-depth technical analysis. They just jump in, with no real logic behind it, except a specious look at what's happened recently.

In gambling, it would be like betting black because black has hit three times in a row, and black is obviously "on a hot streak." In sports, it would be a fair-weather fan. Except in the stock market, there's big money at stake.