At the core of most investment approaches lies the practice of valuations, the techniques by which the real or intrinsic value of a company can be estimated.
Most investors want to buy securities whose true worth is not reflected in the current market price of the shares.
There is general agreement that the value of a company is the sum of the cash flows it will produce for the investors over the life of the company, discounted back to the present.
In many cases, however, this approach depends on estimating cash flows far into the future, well beyond the horizon of event he most pro-phetic analyst.
Value investors since Graham have always preferred a bird in the hand - cash in the bank or some close equivalent - to the rosiest projection of future riches.
Therefore, instead of relying on techniques that must make assumptions about events and conditions far into the future, value investors prefer to estimate the intrinsic value of a company by looking:
1. first at the assets and
2. then at the current earnings power of a company.
Only in exceptional cases are they willing to factor in the value of potential growth.
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Value investors prefer to estimate the intrinsic value of a company by looking first at the assets
Value investors prefer to estimate the intrinsic value of a company by looking first at the assets and then at the current earnings power of the company.
http://myinvestingnotes.blogspot.com/2013/08/value-investors-prefer-to-estimate.html
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Discussions
1 person likes this. Showing 3 of 5 comments
KW, it's not easy to learn and understand TA. You have take a course and like what OTB says, have to read 500 charts before you are fully aware of the benefits.
2013-08-17 19:58
Cold eye's way need fundamental analysis (FA), OTB tend to technical analysis (TA). However, if u can combinate both FA & TA views. Are more beneficial for decision making n confident in keeping that company share. I love cold eye way but take more patients. However, OTB way are favor by more buyer as instant results in a short period. Any how, I have distributed my funds in FTA FORMULAS (FA+TA).
2013-08-19 21:56
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CS Tan
4.9 / 5.0
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Micheal Teo
Thank you Mr. Tan KW for ur matured n logical view on stockmarket investment. I presume u r ardent fan of world renowned investor - Warren Buffet n Benjamin Graham etc...
2013-08-17 17:32