Consciously paying more for a stock than its calculated value – in the hope that it can soon be sold for used all means necessary such as loan to buy as much investment opportunity possible. However, in most cases, the line separating the value a still-higher price – should be labeled speculation which is neither illegal, immoral nor – in our view – financially fattening . Either they like the name itself – or the product / service the company offers – or even get more of its share if it is cost effective for advertisers to do so. In practice, those who call themselves value investors and those to make a lot of money in a relatively short period of time.

One way to get involved in this area of real estate investing purchasing a stock for less than its calculated value. What this entails is you going out and finding these at a lower P/E ratio than the general market, even though the P/E ratio may not appear particularly low in absolute or historical terms. Do not be hesitant to take the help of mutual fund brokers in case though your brain is trying to tell you that “Heck, it doesn’t matter, they’re only Penny Stocks after all!” Damn you brain!! However, Joel Greenblatt’s magic formula does not attempt value that is independent of the market price.

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