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If I think something will be worth $100 in 10 years I won't be paying $100 for it today. That's not how finance works. There is a risk and interest premium. Sur
by pakitan 10y ago
If I think something will be worth $100 in 10 years I won't be paying $100 for it today. That's not how finance works. There is a risk and interest premium. Sure, if you think the risk is zero, then yes, Tesla may not be overvalued. But that's exactly my point - the risk is not zero. Neither for Tesla, nor for any other company.
- eloff 10y agoYes but that's a strawman. You also won't be paying the current value. You'll pay something between what it's worth now and what the market thinks it will be worth one day. That will be discounted for risk and for the delayed gratification.
- pakitan 10y ago> You'll pay something between what it's worth now and what the market thinks it will be worth one day That sentence doesn't make sense. I think you're conflating worth/value (subjective measures) with price (objective). I can't pay more for an item than what's it worth to me
- eloff 10y agoBetween current value (what it should be fairly priced at) and future worth (what it may one day be priced at.) You know what I mean.