So now, the SEC argues, analysts must develop information the old-fashioned way. Okay, if an analyst visits competitors, reads trade journals and otherwise develops unique insight, then he can tell Fidelity, Putnam or Alliance Capital and no one else with impunity. And thanks to Reg FD, the big companies today seldom report earnings during trading hours. This often causes significant dislocations in the after-hours markets. God help you if you trade then.
Confusion also reigns because historical guidelines nowadays are misleading.
Take the idea of capitulation, which is when the marginal investors are purged of any desire to ever own stock. The result of a climactic selloff, capitulation signals a market bottom. This sounds good but is not necessarily valid. No one ever really knows when we've hit bottom until afterward. The end could be violent but also cathartic.