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I think this a bunch of words which are profound but don't look that way to many people. Value investing is another name for allocating your resources to thing

• paulmendoza 6y ago
  If the world is quickly changing then holding onto a bunch of sinking ships might not make a lot of sense. Look at a lot of the S&P 500 stocks. How many old world companies are potential targets for disrupting. Look at oil. It isn’t in a good spot. Some of the largest companies used to be oil companies. But not anymore by market cap. They are still paying dividends while losing money. How? They are taking loans out. At a certain point that stops and more investors wake up. But my time horizon in 5 to 10 years when picking investments.
  • imtringued 6y ago
    Dividends are paid out on a single day. Not getting a loan to spread the costs of dividends over the whole year is insane at current interest rates. What are you going to do with that money? Sit on it? Oil companies are unsurprisingly going down because their bread and butter business is currently not in demand. In a few years things will look differently. The real problem is that a lot of companies don't have an obvious "bread and butter" that actually brings in enough cash to justify their valuations. They are mostly selling the dream of a monopoly to investors even when those future monopolies have no moat other than money.
• lordnacho 6y ago
  On that note, interest rates, even long ones, are really really low these days. One way to think about value and growth is to say that you need to discount speculative future incomes. Well it used to be that five or ten years out rates could be 8-15%, and then you had to compound. And that's just the cost of money, you need to think about how likely the income is in the first place. So it shouldn't surprise us that when rates collapse, companies with mostly future unknown income gain in value compared to those with current certain income. The big question is whether rates will ever come back to what we used to see.