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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (65061)	10/4/2020 5:03:00 PM
From: Elroy	3 Recommendations Recommended By ekimaa Lance Bredvold petal Read Replies (1) \| Respond to of 78814

Since investments returns are driven by REAL WORLD events (ie, lots and lots of different things) you can seldom say what exactly makes a stock go up or down. You can sort of attribute a given day's share price movement to big news which was released in between trading sessions (ie, a stiock trading at $28 yesterday releases bad news over night, and trades between $22 and $23 the next day, the $5.50 drop on market open is due to exactly that bad news), but other than that, attributing performance to specific causes is, well, tough! For example, the stock in the example above over the next week may increase by $2 in share price, in a flat market over the same week. Why? The bad news pushed the stock price down $5.50 immediately, but only pushed the stock price down $3.50 over a one week period? Maybe, but, it often cannot be attributed to anything. However, common sense says that the MORE information you have about anything related to a stock (financials, macro trends, outlook, competition, management skill, etc etc etc etc) the more able you are to add all of your knowledge together, and make a better investment decision.about the stock. You may still get it wrong, but it's hard to argue something like a doctor with less information about a patient is probably more like to heal the patient when compared to a doctor with more information about a patient. Yes, one of the invesment skills is saying "this information is interesting, but not relevant". That may be the case in some pieces of information, but of all the things you can know about a stock, the financial reports are probably THE MOST important. Your view of the company's outlook should be confirmed by future FINANCIAL STATEMENTS. Your understanding of the company's industry and the position within the industry should be confirmed by historical FINANCIAL STATEMENTS. I get the idea that excessive analysis of financial statements may have diminishing returns, but of all the categories of company and stock info that might potentially be useless, I think financial statements are among the last to be placed on that list.

To: Paul Senior who wrote (65061)	10/4/2020 6:11:09 PM
From: E_K_S	1 Recommendation Recommended By Lance Bredvold Respond to of 78814

I think now w/ AI and BIG Data, much of the detailed analysis is done by computer. The market may be getting more efficient in that way. I have noticed that Private Equity and Hedge Funds tend to 'blow-up' more because those funds used a huge amount of leverage & derivatives that went sour. The individual may be able to perform better just because of the size of the money they manage. One of the things I have learned over the last 35 years is it is easier for me to accept the daily losses/gains and use a strategy of scaling into my Buys/Sells. I now will Buy/Add every 2% lower and have those order(s) entered w/ GTC and expect to get those orders filled as the market sells off (sometime over 900 points in one day). I do not do my Sells this way but will scale out of my gainers if/when I think they are fairly or over valued. Even then I do not completely sell out of the position. I lost too many good gainers (like MSFT, ORCL and others). The one HUGE thing different now that I have seen from when I began investing in the late 1970's are these historically LOW Interest Rates. We may even see 'Negative' interest rates. This is unheard of and was never taught in any of the finance classes I took in college. It's like dividing by '0'. The flip side is how is the market going to react when interest rates eventually 'normalize' and will value investing be the strategy that may/could save/maintain the value of your portfolio. EKS