General
catch a falling knife
What does catch a falling knife mean?
To buy a stock or other asset while its price is still tumbling, gambling that you've called the bottom. The metaphor is exactly what it sounds like: grab the handle and you're a hero, grab the blade and you bleed. Usually said as a warning, not a recommendation.
"I know it's down 60%, but you don't want to catch a falling knife, wait for it to base."
Frequently asked questions
What does 'catch a falling knife' mean in trading?
It means trying to buy an asset while its price is still crashing, hoping to catch the bottom before you get 'cut' by further losses.
How do you use 'catch a falling knife' in a sentence?
"Don't try to catch a falling knife — wait until the stock actually stops dropping before you buy."
Why is buying a falling asset called catching a knife?
Because a plunging price is like a blade dropping — grab at it too early and you get sliced by more losses.
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