Investments down again.

[renault12ts]

The value of shares when markets rise and fall, as they do daily, has nothing to do with the companies involved.

When an individual share rises or falls, then that is an indicator as to how that company is performing or might perform.

 

[renault12ts]

Before you jump in, can you at least read and understand what is being discussed cause from your reply to me it shows you havent got a clue and please I am not intereseted in debating anything with you. I clearly address the people I wish to speak to so please leave a brotha alone.

cheers.

Sorry, I wasn't having a go, just agreeing that your point was simplistic (as you said yourself). But if you can point out the fault in my statements thus far then I'd be pleased to hear your arguments. But you do find it difficult to understand why Tesco has fallen, I thought I'd help you.

You didn't say no one else could answer your post. If that was your point you could always PM those posters.

 

[Pappilo]

Sorry, I wasn't having a go, just agreeing that your point was simplistic (as you said yourself). But if you can point out the fault in my statements thus far then I'd be pleased to hear your arguments.

Like I said I will not get into any debates with you cause I know when thing get heated you will go running to your moderator friends so please leave me in peace so I can have a debate with more matured forum members

Thank you

 

[renault12ts]

Like I said I will not get into any debates with you cause I know when thing get heated you will go running to your moderator friends so please leave me in peace so I can have a debate with more matured forum members

Thank you

I'm lost. Have you and I had words before?

 

[crockers]

Shares also move when the equity risk premium is deemed out of kilter. That is the risk premium for which one expects to be rewarded for taking the extra risk of holding equities over risk free holdings. In the long term that should be around 3%. This is excluding sentiments etc for which there are no calculations. Rough formula is capital value plus income stream divided by sovereign debt and inflation. At the height of the 2000 boom ERP was negative therefore indicating investors were actually paying, not being compensated, for holding equities. A true sell indicator.

 

[Dieselman]

Before you jump in, can you at least read and understand what is being discussed cause from your reply to me it shows you havent got a clue and please I am not intereseted in debating anything with you. I clearly address the people I wish to speak to so please leave a brotha alone.

cheers.

But Yo and Bro are wrong in this instance.

In normal circumstances the share price is an indicator of the company performance thus is linked to value and dividends, but these aren't normal circumstances and shares have taken a dip in value because investors have been scared off in general, thus the reduction in value of Tesco shares is not an indicator of it's performance or dividend value.

Once investors come back to the table these shares will bounce back.

 

[renault12ts]

Normally stocks like Tesco's are a safe haven in difficult times, people always have to eat, bit like undertakers, always a steady business

There are many companies that are as solid as Tesco. But all are falling (or have fallen). What is happening now is to the market as a whole, and individual companies do not come into the equation. But hold the strong companies and eventually things will turn again, (after likely further downs on Monday).

 

[renault12ts]

But Yo and Bro are wrong in this instance.

In normal circumstances the share price is an indicator of the company performance thus is linked to value and dividends, but these aren't normal circumstances and shares have taken a dip in value because investors have been scared off in general, thus the reduction in value of Tesco shares is not an indicator of it's performance or dividend value.

Once investors come back to the table these shares will bounce back.

Brave...very brave.

I think you said that as clearly as anybody could have done...here's hoping.

 

[crockers]

The problem is the word "eventually". People have different interpretations of that time frame, and expectations.

 

[renault12ts]

The problem is the word "eventually". People have different interpretations of that time frame, and expectations.

Correct.

"Eventually" is about time. If an investor needs his money in the short term, then eventually may be too long...but then he should not have remained in the market close to the time he needed his money.

You should not invest in these markets if you can't afford either the loss or the time.

 

[Pappilo]

But Yo and Bro are wrong in this instance.

In normal circumstances the share price is an indicator of the company performance thus is linked to value and dividends, but these aren't normal circumstances and shares have taken a dip in value because investors have been scared off in general, thus the reduction in value of Tesco shares is not an indicator of it's performance or dividend value.

Once investors come back to the table these shares will bounce back.

Is that so for the value of LinkedIn? or the soon to be floated Facebook. Are these comapnies really worth what thier present valuations say? LinkedIn has floated already and last I checked before the last 6 day downward trend the share price was sitting at $102 i.e. about $9 billion!!

Facebook is currently valued at around $60billion, some say it should be as much a $100 billion. Tesco is valued at around $50billion. which stock would you rather be buying?

 

[crockers]

Taking Tescos as an example is interesting. You are assuming a few things. One is the capital valuation was correct before the correction. Two the future income steam will grow. If those two are not correct their share price now may be the correct one, not the one of a month ago.

 

[crockers]

Is that so for the value of LinkedIn? or the soon to be floated Facebook. Are these comapnies really worth what thier present valuations say? LinkedIn has floated already and last I checked before the last 6 day downward trend the share price was sitting at $102 i.e. about $9 billion!!

Facebook is currently valued at around $60billion, some say it should be as much a $100 billion. Tesco is valued at around $50billion. which stock would you rather be buying?

Can I refer you to post #105.

 

[renault12ts]

Is that so for the value of LinkedIn? or the soon to be floated Facebook. Are these comapnies really worth what thier present valuations say? LinkedIn has floated already and last I checked before the last 6 day downward trend the share price was sitting at $102 i.e. about $9 billion!!

Facebook is currently valued at around $60billion, some say it should be as much a $100 billion. Tesco is valued at around $50billion. which stock would you rather be buying?

It is not about individual shares at the moment. Tesco is probably a sound buy. But when investors are selling everything, then it becomes a buyers' market, and prices fall.

If I was to buy Facebook, it would have a watching brief...remember My Space etc.

 

[Pappilo]

@ Renault

But if the individual company is sound like I know Tesco and many others are, it should buck the trend. the reason why all the sound investments are losing value is beacuse everything is based on speculation and is determined by the MMs

 

[renault12ts]

@ Renault

But if the individual company is sound like I know Tesco and many others are, it should buck the trend. the reason why all the sound investments are losing value is beacuse everything is based on speculation and is determined by the MMs

You are in general correct. But when prices fall its because investors are selling...if they didn't sell the prices would not fall.

But there are many companies out there that you could argue should buck the trend, they are selling their goods, they are making profits, paying dividends, but they are also down.

This is a general malaise, and it effects everybody. But all you do is hold on, don't sell (unless you think the values will fall further and you can buy back at a lower price (risky without the systems in place do to do this)).

 

[Pappilo]

LOL @ post 105

Do you work in the City? Them guys come up with all these funny calculations. Were these same calculations not used to value the comapnies that went bust in the dotcom era?

 

[Pappilo]

You are in general correct.

But there are many companies out there that you could argue should buck the trend, they are selling their goods, they are making profits, paying dividends, but they are also down.

This is a general malaise, and it effects everybody. But all you do is hold on, don't sell (unless you think the values will fall further and you can buy back at a lower price (risky without the systems in place do to do this)).

so we are saying exactly the same thing! maybe lost in translation.

 

[renault12ts]

so we are saying exactly the same thing! maybe lost in translation.

Not really...I'm not surprised at all that the price of Tesco has fallen. It just doesn't matter.

 

[Pappilo]

I am not suprised it has fallen either because it is manipulated by MMs and affected by speculation. My argument is that these days the share price of a company is not the true reflection of what the company is worth. If it was, in times like this, the uselss companies like the banks and linkedIn will lose value and the proper ones will keep their value.