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I understand, and I’m claiming there is no one logical or fundamental way to derive a price. It could be logical to ascribe some value to a business’s leader h
by lotsofpulp 2y ago
I understand, and I’m claiming there is no one logical or fundamental way to derive a price.
It could be logical to ascribe some value to a business’s leader having access to a US president known to be “open for business”? And we know a big tax bill is likely to be passed by year’s end.
Perhaps that will lead to good fortunes for Tesla shareholders. Or maybe not.
- ZeroTalent 2y agoYou can derive the "true price" with a certain probability. Of course, unexpected things can happen, like Musk being assassinated, but the stock market is not completely unpredictable. And the thing is, I don't have to be right about Tesla because I'm not making a single bet on that company. I'm making hundreds of bets using my methodology, and it's enough that I'm right 50-something% of the time (or even less than 50%, if we're talking Options trading). That's what the whole stock market game is about. Hence, some investment companies, like Berkshire Hathaway, consistently make more than others over the long term.