On Buying Low and Selling High

This question came up twice today in two different venues so I thought I'd natter on about it for a few minutes.

On a writers' loop I belong to and, later, during the Writer's Chatroom discussion tonight, I was asked about trying to write in a genre that's "hot."

The conventional wisdom is that, by the time you identify a "hot" trend and write a novel in that genre, the market will likely be saturated and the trend cooling down.

A perfect example is the popularity of chick lit novels. Every publishing house opened a chick lit imprint, and almost every writer had a story featuring expensive high heels, a gay best friend and an obsession with shopping. By 2006, you couldn't give a chick lit manuscript away.

But something interesting happened. The chick lit voice (full of attitude but minus the high heels, gay friend and shopping obsession) morphed across genres into another hot trend: urban fantasy.

So . . . should you try to chase a trend or not?

If your goal is a New York publisher, probably not. It takes New York a long time to release a book. By the time you identify the trend, write the manuscript, get a contract and are published, the odds are good the trend will be on the downswing.

However, if your goal is e-publishing, it may be possible to jump on a trend before it cools down. E-publishing can release your manuscript online in a third of the time it takes to get traditionally published.

The flip side thinking is that you need to write the book that matters to you, no matter whether it's in vogue or not. This train of thought holds that there is always a place for a well-written book and that, even if you can't sell it today, the market will cycle back around in six months, a year or three years, and you'll be able to sell it then.

Thinking about this, I was reminded of my years in the stock brokerage industry where the mantra is "buy low, sell high." We were always having clients call, wanting to buy the hot new stock. The only problem was, by the time Joe Ordinary heard about the stock, the price jump had already happened. Our clients were asking to buy a stock that was now too expensive and probably due to drop in price.

In order for buying and selling based on "hot" trends to work, you have to catch the trend on the uptick, not the downtick. If you aren't in on the beginning, most of the upswing momentum will be over by the time you hear about it.