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Technology Stocks : Network Associates (NET) -- Ignore unavailable to you. Want to Upgrade?

To: Edwarda who wrote (5417)	6/29/1999 11:20:00 AM
From: The Philosopher	Read Replies (2) \| Respond to of 6021

I get your point, but you miss mine. What a "reasonable valuation" for a stock is a matter of personal judgement which is affected by many factor, including what the overall market is doing, the psychology of the individual investor, etc. Certain quantitative analysis tools applied to estimates of a company's prospects and assets may at a given time suggest a range of values for a stock some or all of which are below what the market values the stock at. I use certain of those tools myself to try to root out what in MY mind are bargains. But what makes those "reasonable" values? They are reasonable to the analyst, but may not be reasonable to the individuals buying or selling the stock. It is the differences of opinion about the "reasonable" price for a given stock on a given day that make a market. Very few investors will agree that they are acting unreasonably in their buy and sell decisions. What seems reasonable to them and what seems reasonable to you will differ; that's why it's possible for stocks to be bought and sold at all! I would argue that any price at which a stock trades is a reasonable price for at least some traders. Since reasonableness is entirely a matter of opinion, market psychology IS a part of the very definition of reasonableness. P.S. Can you tell me what a "reasonable" valuation for Amazon is?????