One Night Stand Investment

AAA

DEFINITION of 'One Night Stand Investment'

A purchased security that was intended for a long-term investment, but is instead sold the next day. One night stand investments are often sold urgently on the trading day after purchase, because the investor regrets buying the shares to such a degree that fear and panic begin setting in. This can even lead to immediate, short-term losses. A one-night stand investment is typical of an indecisive investor, and is related to the field of behavioral finance.

INVESTOPEDIA EXPLAINS 'One Night Stand Investment'

Much can change overnight in a company and an industry. An investor who researches an investment and buys one day, feeling that the company and its future are strong, may be panic-stricken and ready to sell the next day when unexpected news threatens his or her perceptions of the security of his or her long-term investment. The incidents instigating the sudden sale can include many things, such as the company's profits missing their target, industry shifts, acquisitions and regulatory changes.

RELATED TERMS
  1. Coattail Investing

    An investment strategy in which investors mimic the trades of ...
  2. Behavioral Finance

    A field of finance that proposes psychology-based theories to ...
  3. Bo Derek

    A slang term used to describe a perfect stock or investment. ...
  4. Nervous Nellie

    An investor who isn't comfortable with investing and the risks ...
  5. Panic Selling

    Wide-scale selling of an investment, causing a sharp decline ...
  6. Buy And Hold

    A passive investment strategy in which an investor buys stocks ...
Related Articles
  1. 4 Psychological Traps That Are Killing ...
    Active Trading Fundamentals

    4 Psychological Traps That Are Killing ...

  2. An Introduction To Consensus Indicators ...
    Active Trading Fundamentals

    An Introduction To Consensus Indicators ...

  3. An Introduction To Behavioral Finance
    Active Trading Fundamentals

    An Introduction To Behavioral Finance

  4. Tips For Investors In Volatile Markets
    Investing

    Tips For Investors In Volatile Markets

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center