A one-night stand investment is purchased security that was intended for long-term investment but is instead sold very quickly, many times as soon as the next day. One night stand investments are often sold urgently on the trading day after purchase because the investor regrets buying the shares to such a degree that fear and panic begin setting in. This can even lead to immediate, short-term losses. A one-night stand investment is typical of an indecisive investor and is related to the field of behavioral finance.
An investor who researches an investment and buys one day, feeling that the company and its future are strong, maybe panic-stricken and ready to sell the next day when unexpected news threatens his or her perceptions of the security of his or her long-term investment. The incidents instigating the sudden sale can include many things, such as the company's profits missing their target, industry shifts, acquisitions, and regulatory changes.
A one-night stand investment might also be the result of the stock not living up to expectations, outside events that may impact the stock, such as a competing company, or a natural disaster that ruins a factory where the company is run.