DN, Basically, I have confidence in my valuation model and my ability to forecast reasonable inputs into that model. For the past 3 years, my model has shown the market overpriced and my inputs have turned out to be too optimistic. Yet, the stocks go up.
The simple fact is, these are not gambling games, they are cos. Cos. will return something to shareholders over the long haul totally removed from any thought of capital gains. In other words, the discounted value of all the dividends paid. And, using that concept, there is no way the market is fairly priced and tech stocks, though the future is murkier due to technology changes, are among the most overvalued.
So, despite the fact that the greater fools continue to jump on, I am certain that someday the stocks will have to be valued as operating cos. and when that happens, the prices will be coming down. Big time. In the meantime, I have a money mgt. system (90/10) that maximizes my gains and minimizes my losses. That means I will be flush when the end game is played. |
