Inside Day

When we were kids, an “inside day” referred to a day when the weather was too crappy to go outside and play, so all of us students had to spend our recess period indoors, doing something lame, like, uh...homework.

Now that we’re all grown up, though, an “inside day” is something much more exciting. It’s a day where the high price of a stock or another security is lower than it was the day before, and at the same time the low price is higher than it was the day before. Know what that means for our overall investing strategy? Absolutely nothing. That’s because inside days happen all the time, and really can’t tell us very much about the market, or even the specific security, as a whole. All they really tell us is that the stock is less volatile than it was the day before.

This doesn’t mean we can’t make any money on trades made on inside days. It just means that we might not be able to determine any longer-term trends based solely on the fact that it's an inside day.

Hmm, now that we think about it, maybe adult inside days really aren’t that much more exciting than indoor recess.