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I don't think this is true. People analyze every detail of the books on those public filings. If the culture of investors changes such that a low cash reserve
by Consultant32452 7y ago
I don't think this is true. People analyze every detail of the books on those public filings. If the culture of investors changes such that a low cash reserve (or whatever) is considered risk, that will be factored into the stock price. This is particularly true if having continually low reserves bumps you off important indexes.
- TeMPOraL 7y agoThe level of reserve investors require may initially be high after this, but it'll go down over time, bit by bit. What I'm saying is that market isn't static, and the forces that move it are stronger than individual risk tolerance. The pandemic will change the risk tolerance, but it'll revert over time. A related concept is the so-called "normalization of deviance".