Raymond,
Clearly you an expert practitioner of TA, and there's no way anyone will convince you that the analysis you applied to THQI is less valuable than FA. Fine...that's what makes a market. I just have to question your logic, though, as it applies to THQI and some of the other companies you mention:
>>>A small joke in the buy side of institutions is what is a billion dollar company worth if no one wants to buy its shares? Answer: nothing. Great products are great, but they don't mean anything if no one wants a piece of the company that makes the products. That's what is happening with THQI. The fundamental front is beautiful. But people are selling shares. And I don't know why and honestly I don't care. <<<
You know, the buy side of institutions are quite famous for under-performing the market, and your quote about them shows why: they're all chasing each other's buy and sell decisions. If you decide to buy when everyone else decides to buy, then by definition, the price is higher. A higher price means a lower return. It really is not rocket science.
This is very precisely the observation of Warren Buffett, who made much of his fortune in the bear market of the early 70's: the exact time when no one -- particularly buy-side institutions -- seemed to want stocks of even the greatest companies.
Their error? In their desire to make sure they were only buying what others were also buying, they forgot that the value of an income-producing asset is the sum of all the cash flows of the business, discounted at an appropriate rate. Fortunes are made when others mis-price the asset. Manic-depressive behavior in the financial markets tends to occur when people forget that.
Based on this view, my personal hope is that there's an additional, massive sell off in the stock based on more herd behavior. That would enable me to buy more shares at an even better price.
Again, just my approach. Best of luck to you.
-OGM |
