JuliaC's  Instablog

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A student of tech analysis and Dividend Growth Investor.
  • I Will Buy This Stock When It Will Become Undervalued...  2 comments
    Jul 30, 2013 2:34 PM

    Hi, I decided to write an instablog. Why would I do it? I want to help. May be in some small way, but to help those people who think that they can easily pick up undervalued stocks and buy them or sell overvalued stocks.

    Of course, if you are an experienced trader, who consistently makes money - this instablog is not for you. You know what you can do and what you can not.

    But if you are aspiring investor and have great expectation of "managing your portfolio" by buying undervalued and selling overvalued positions, I want to tell you something. It is not as easy to do as you think.

    Please read below - this is not mine, it is from "The Single Best Investment" by Lowell Miller. I would not be able to say it as good as he did.

    Please enjoy it and it might save you some money and time.

    "The quest for so-called "undervalued" stocks is a tricky one, resting upon a questionable premise. What would lead an average investor to believe - for that matter what would lead a professional investor with a team of assistants to believe - that the investor can recognize an "undervalued" stock whereas all the rest of the world, all the trillions of dollars of brain and computing power, all the armies of research and global profit-seekers, cannot? When you think about it, the view that a particular stock is undervalued can only be seen as sheer arrogance. "

    Well said!

    I Will Buy This Stock When It Will Become Undervalued...I hear this all the time. Undervaluation is a belief. It is a story you tell yourself that the stock will come around, do better in the future, that investors now are too emotional and they will change their opinions.

    Would it really happen? Nobody knows, like nobody knows he future. Take your best guess, tell yourself a good story, but its all comes to probabilities.

    True bargains barely exist. If they are - they are snapped in a moment, probably before you will even hear about them or will time to think.

    "You are not alone with your information today. No investor is. All the information you can legally use is at your fingertips on the web, and in the numerous business publications and media which are pumping out the facts as fast as their reporters can speak or pen the words…No one knows more then anyone else at this point, save company management" Lowell Miller.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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Comments (2)
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  • Chowder
    , contributor
    Comments (15540) | Send Message
    Nicely done!
    3 Aug 2013, 09:18 PM Reply Like
  • JuliaC
    , contributor
    Comments (42) | Send Message
    Author’s reply » Ooo, Thanks Chowder. You are too kind! :)
    4 Aug 2013, 01:09 PM Reply Like
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