Some investors jump in and out the market at the drop of a hat. This strategy has not been a proven method thus far. Many of these impulsive investors are "do it themselves investors" or "deal with a hands off broker."

Some people are like impulsive gamblers. They experience highs and lows, but they cannot cut their losses and want to keep playing. Those investors who just buy and sell stock based on good or bad news in the market are like gamblers. Sure this is a harsh statement to make. However when you buy stocks after the market goes up, a certain euphoria may hit them, similar to what a gambler feels at the slot machine. This impulsive investor may keep buying and buying until the market goes down.

The lows occur when the stock goes from good to bad. This wave of happiness is replaced with despair and disbelief. People often panic, and start selling their shares. This investment strategy is unproductive. These investors usually miss a good day or two, and then decide to jump back in the market.

It is not a great strategy to trade just off good and bad news, especially when you consider yourself to be an investor. When you look at the amount of commissions you incur from "jumping in and out the market" what have accomplished? You miss several key days each year when the market does really well. Many brokers will not deal with clients with this strategy. It would be easy to blame the advisor, and most brokers do not want the hassle. It takes a strong broker to deal with this type of impulsive investor, and should have them sign a form, stating the danger of this investing strategy.

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