The lowest point in a share’s price cycle. Beginners get excited when a share is going up – smart investors get excited when it is going down, especially if it is a high-quality blue chip. Their goal is to look for the bottom of the cycle so that they can buy in and profit from the upward move, when it arrives. Consider the following chart:

You can see here that Standard Bank, which is one of the strongest blue chips on the JSE fell to a bottom in January 2016 – at which point it represented excellent value.

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