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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Juliet who wrote (21369)	3/26/2000 6:15:00 AM
From: Hanney Yin	Read Replies (1) \| Respond to of 54805

You wrote:"It's interesting to think that you could arrive at a real mathematical value for Gorilla-ness in this way" Using common wisdom, we are able to estimate the NPV of gorillas. Based on my rough calculation, NPV(5% 10yrs), GMST is $32.31, ELON is 8.25, CREE 58.59, NTAP 42.98, while WM is $56.23 (price now $26), MO is 56.35 (price $19 w/ 9% yield). Common sense also tells me that the interest rate is the discounting mechanism for valuing asset based on the concept of present value of future earning. The high valuation of tech stocks are based on high expectation of future earnings. the value of such very remote earnings fall exceedingly quickly as the discount rate rises. Most of us never experienced bear before. But today, mindless speculation, rich valuation, worsening bad breath and disregard of value (I sighed when I read the WSJ saying VALUE fund managers were forced to pick tech w/ their hands shaking), vertical movement of QQQ, all direct us to an answer that we refuse to say YES. Lastly, the common sense tells me that if the hedge fund were to short QQQ in the near future, near term rally w/ weak volume would be expected. Anybody go Kaiyak here-- turning the direction of the Kaiyak creates tremendous amount of turbulence (volatility), that is exactly where we are now. PS, this is JUST my personal view about the TECH gorillas. THEY ARE SUBJECT to fall if valuation is out of norm.

To: Juliet who wrote (21369)	3/26/2000 10:21:00 AM
From: chaz	Read Replies (1) \| Respond to of 54805

Good that you point that out. Uncertainty is a relative thing. If we know a lot about company A (in your example) or think we do, and we know a lot about Company B, and know we do, both futures are uncertain, but one is less so than the other, and we might feel safer in B than in A. Chaz

To: Juliet who wrote (21369)	3/26/2000 2:15:00 PM
From: Mike Buckley	Respond to of 54805

Juliet, It seems--to my pretty uneducated eye--that certainty vs. uncertainty is not properly factored at the moment into many relative stock prices. That observation is the symptom of a very educated eye, or in the least an astutely intuitive eye. I would add to your observation that certainty and uncertainty are in the eye of the beholder aas are efficient and inefficient markets. When students of Gorilla Game arrive at a view point leaning toward certainty about a Gorilla's future and at the same time the market appears uncertain, that to us is a huge market inefficiency that is the essence of an undervalued stock. Similarly, when our opinion leans toward the uncertainty of a King's or Prince's future and at the same time the market appears to be certain, that to us is a huge market inefficiency of a different kind that is the essence of an overvalued stock. Somewhere in between is an efficient market, something that fortuntately for us rarely exists. --Mike Buckley