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To: Dinesh who wrote (7763)	4/2/2000 12:46:00 PM
From: Chuzzlewit	Read Replies (2) \| Respond to of 9068

Dinesh, I do believe that there are different scaling factors for relative market positions. I believe that what you are getting at is the perceived riskiness of a business. And you are right. Companies whose perceived risk is high (because of a relatively insecure market position) command lower prices, and companies whose market positions appear to be secure command higher ones. Put another way, the risk-adjusted discount rates are lower for well-established companies with good earnings visibility. But my point was that risk-adjusted discount rates can never go below the risk-free discount rate. Re: Nobel laureates. They have never claimed to have discovered a hidden gold mine. The have given us a framework for analysis through modern portfolio theory. But MPT is not a crystal ball. Indeed, much of its power lies in its ability to capture the randomness and riskiness of markets. If you want to read an excellent, non-technical book about MPT I suggest you read Malkiel's A Random Walk Down Wall Street [Random walk is a statistical term describing certain kinds of movements]. TTFN, CTC