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To: Arthur Tang who wrote (754)	4/4/1998 7:38:00 AM
From: Arthur Tang	Read Replies (1) \| Respond to of 1471

Is there something missing in VALUE INVESTING? Why ValueLine 100 picks failed to achieve superior gains? Value investing is based on the soundness of a company. As solid as they come, a company such as IBM or GE would qualify as the best in value investing. Indeed, for many a year, people had made much gains with the best value investing concept. But ValueLine do switch their 100 picks from time to time to maintain the best gains. And, last year their number one rank finished with less gain than number two picks. Worse yet, their last or fifth ranked picks also gained over 20%. All five ranked picks finished between 20 and 40% gains. Error in ValueLine's concept is that they are calculating the value of a company technically (meaning by past numbers) rather than intuitively(meaning by the direction of the future technology of their products and/or services). They also neglected the effect of the economy in value investing. Worst of all, the value investing method neglected the fact that money chases investment instruments, and the market broadens. ValueLine would never spot the problem at GE with Kidde Peabody in the past. Nor the problem with IBM, in distributed computing technology changing the fortunes of mainframe computing in the future. In the new economy, money chases investment instruments and market broadens, ValueLine has to change their perception of investing prospectives.