Insider knowledge, or leakage, happens all the time.
The world is indeed an unfair place. Someone who have that special “insight,” has an edge that normal folks like you and I have no access to. Accept it and let it go. These inequality does not have to be right-ed.
Price movement usually happen in sectors, day-to-day.
“Defensive” supermarket stocks during COVID-19? Checked.
Oil crisis when Saudi Arabia decided to flood the world with supply? Checked
These movements demonstrated the clout that institutional investors have. But does it matter? I think not. These actions sometimes provide us with opportunities. During the property crisis, Wheelock did not have the troubles that other property countershave, and it still got sold down.. to me, it was an opportunity...
Value investing is really a test of patience. I have a couple of stocks that I have been holding to close to three years and I am still on a manageable unrealized loss. I have no complaints— sometimes things happen very quickly for me, in a matter of weeks or months. Cross-Harbour (wasn’t my idea), and I got rewarded in a matter of 3-4 weeks. I was expecting to hold it for 3-4 years...
Most people do not believe in value investing, because it is uncomfortable. I tried in vain to convince friends to adopt the value approach ….
This is because value is subjective, but prices shown on your screen isn’t. It is my opinion that you need to enjoy solitude in order to succeed the value way. Most human beings aren’t groomed for that. We all desire that social proof.
There are too many people out there showing off their huge portfolios but most of it was built not from investing returns, but family backgrounds, or from business/salary.
Stock market participants love to look at the price movements and then justify it with a myriad of reasons. They got it backwards.
Rarely is a company cheap without being under some kind of problem(s). Most books does not stress this enough. The book that explained what is uncertainty and what is risk, for me, is Mohnish Prabai’s The Dhando Investor.
Most people are not interested in investing. They are only interested in the money. Treat the market like you are solving a puzzle and perhaps you can handle the emotional side of things easier.
But deep value investing is not scalable. Hard to accumulate a sizable position in portfolio if those counter are so thinly traded. Spliting into multiple day accumulation will only rack up transaction cost. :(
ReplyDeletethis isn't a problem for me, since my portfolio isn't that large to begin with.
DeleteI am mindful not to invest too much in these illiquid stocks as they can be a pain to let go when I am wrong.