Would you buy stocks from a company that declare bankruptcy ?

Question

Well, it would be a risk of course, but if a company does so bad, the share price from the company trop's really low. And if you lucky enough and the company might recover, after a while couldn't you make some huge profit on it ???

I think, but can't remember anymore, that someone told me that one day "or maybe month" it might with go back up again with the stock. So I wanted to ask for a other opinion maybe from someone who knows about what he is doing.

Answer 1

This is pure speculation, not disciplined investing.

Answer 2

Just buy lottery tickets.  That is the same thing.  Unless you KNOW the business well enough to run it yourself, you CAN'T predict the business will recover.

Note: 'Someone told me it might go back up' is equivalent to 'I got a hot tip from the shoe shine boy'.

Answer 3

It may, it may not. If there was a definite answer, everyone would get in on companies that go bankrupt. It is an extremely risky investment, and unless you are ready to lose it all, I don't recommend investing on a company that just went bankrupt.

What is your risk tolerance level, how old you are, your current financial situation, these all determine whether you should make these kinds of investments. When you make these kinds of investments, you should consider the investment already gone, and if it works, be happy about it.