Is it possible to make money buying and selling domain names?

Anything is possible in the internet age and selling domains is a popular way to make money.. but it is not guaranteed. You have to do a little research and it pays to buy the right domains. Top level domains with shorter names can profit more sometimes. For example, "money.com" would be worth more than "abcxyz.info" but finding a really good premium domain can be difficult. Prices of domains can fluctuate and it really depends on who wants the domain and how much they are personally willing to pay. Domain names that have been established or with content can be worth a lot more. Sedo.com is one place you can go to buy and sell domain names. You can set a price or have the domain go up for auction.

I heard from a tech guy that it was considered illegal to buy domains for the purpose of hording and selling for large bucks later. How true is that?