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Pastimes : James Cramer Skeptic Thread

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To: Carmine Cammarosano who wrote (856)10/20/1998 4:56:00 PM
From: Mama Bear  Read Replies (1) of 1254
 
"don't forget that a great time to invest is when stock prices are low(valuation)"

Well, there's no arguing that. But where many who are relatively new to the market make their mistake is equating low valuation with relative price. For example, there were many who bought CIEN at 20 simply because it was down from 92 3/8. If an asset is overvalued by 100% at 100, does it become a good value because it falls to 75?

BTW, corporate profits are contracting, and the big caps are sitting at some historically high valuations based on trailing earnings. By almost every metric.

Barb
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