A week or so ago I picked up CMVT, or Comverse Telecommunications. What is interesting about Comverse is that I bought it after it fell about 15%, because of accounting worries. Unfortunately, since then it dropped another 5% before beginning a recent rebound. Thus, I bought Comverse at 24.89 and it has actually fallen to 24. If I had simply watched the stock when it reached 24.89 and purchased after the 5% drop, I would have been much better off.
Still, the technique I used to pick up on Comverse is an interesting one--one that may be useful for novice value investors, like myself. Using MSN Money's Stock Screener, available here
to pick up on stocks gapping down. This is an automated search available here
. One possible technique for investing is to pick up on stocks whose prices have been irrationally depressed, though a lot of stocks gapping down have rational reasons for their depressions, you can make the appropriate judgment call, research those stocks on a site like yahoo or google (read the news that lowered their value, look over the stock's P/E ratio and balance sheet) and buy stocks that you think will gain value. Hopefully, you will make a better pick than I made with Comverse (though the major loss I have suffered was because it was later revealed that it may take a year or more for Comverse to successfully complete its audit.)