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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (36532)1/26/2010 4:59:21 PM
From: MCsweet  Read Replies (1) of 78753
 
Comment on PAG secondary,

Unless the market has been short anticipating a deal, or there is some great transformative event for a company, a stock will almost always trade down on the secondary announcement, and for a valid reason.

It is the law of supply and demand. Supply has increased and the price has to drop to absorb the new supply. IMO, this dynamic tends to outweigh fundamentals in the short term. As the supply gets absorbed by the market, fundamentals take hold again.

MC
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