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What risks need to be considered with Buy the Dip?

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Risks to consider include :

  • Market Uncertainty: There is no guarantee that asset prices will recover after a decline. Market uncertainty can cause investors to incur losses if prices continue to fall.
  • Overtrading: Buying too often during a downturn can result in overtrading, which can deplete capital and reduce long-term profit potential.
  • Errors in Analysis: Misjudging the cause of price declines or not taking into account fundamental factors can result in poor investment decisions.

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