Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (9) | Ignore Thread Prev | Next
Author: TMFCogitarius Big gold star, 5000 posts Old School Fool Home Fool Global Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 3794  
Subject: Re: Article: The death of value investing Date: 11/25/2008 4:40 AM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 1
PennyPincher12:"Value investing is also concerned with the ability to value a business. It must be understood well."

Well said. Unfortunately, understanding a business today involves deciphering the gobble-de-gook of financial engineering, if only to assess the potential 2nd/3rd order risks involved. So far, looks like not too many people had a clue on this - neither regulators, nor the Masters of Wall Street's parallel Universe.

I certainly didn't.

"Value investing isn't dead, it's just not understood very well by those who don't do it."

IMO, not even by most who claim to 'do it' :0)

Witness the parade of pundits proclaiming fire sales everywhere for most of this year - BRK, SBUX, MSFT, PFE, GM ...


What seems to pass for 'understanding' is most often a 20-20 rear-view mirror image. At best you get some picture of catalysts for a better future. But, you'll be very lucky to find somebody who knows the business and its ecosystem well enough to articulate what will drive it down.

No self respecting 'value' pro can justify that label without showing he/she has a good handle on the inevitable downside risk of any investment.
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (9) | Ignore Thread Prev | Next

Announcements

Managing Your Wealth
Our own TMFHockeypop from Rule Your Retirement fame on the TV show Managing Your Wealth.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Value Hounds

Back to the Future Buffalo Wild Wings
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement