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Strategies & Market Trends : Sonki's Links List

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To: Sonki who wrote (388)	3/10/2009 8:51:57 PM
From: Nancy	Read Replies (1) of 395

Sonki, I have a friend who once told me the P/E is meaningless - a stock's price is what the investor (trader) is willing to pay for - all other stuff is just some excuses people want to use to justify the price. Incidentally, this friend has turned a 60K capital to several millions in about a decade. Since 2005 he is running his own hedge fund with a partner. From your Sept 2008 post to this one, you can see the PEG is meaningless when the E is fictional. Price and Volumes show up on the charts are the true picture of Demand and Supply of the stock. Demand over Supply, price goes up. The opposite, price goes down. Such as GE, the spike down to sub-6 in huge volumes has cleaned out the deck for a while. That marked the short term low for the stock. The range now is 7xx to 9xx. Such as INTC, compare its chart with CSCO & ORCL - you can see INTC's support at 12xx is much stronger than CSCO's 14 (previously 15) and ORCL's 16. Yet, the PEG calculation would tell you INTC is overly expensive - but it is actually the best and safest trader of the 3.

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