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Posts by anantksundaram

So, where did you find this definition of rationality you say is widely accepted?
Where did you find this definition? I've heard of market 'efficiency' defined this way.
A couple of weeks ago, when AAPL fell to $119+, it was because all the analysts, commentators, media etc. were focused on the meme that China's stock market was tanking*, so China must be tanking, so Apple must be tanking in China.   Now it's 'guidance', despite the fact that Apple's 4Q guidance range is outside the analyst average estimate, as it has been in the past.   What a load of crock. People will say/believe it's anything.   *(never mind that it was -- still...
If that were true, all companies could simply buy back all their shares all the time, and everyone would be happy.
Actually, this is a misunderstanding of not only what markets do, but also what investors should mean when they use the term 'rational.' Stocks can be fully and 'rationally' priced in a market relative to expectations of future free cash flows discounted at the risk-adjusted discount rate, and yet, individuals could still make (or lose) money by placing bets one way or another: cash flows and risks can always surprise going forward, relative to expectations. When one uses...
Yahoo Finance? Wow. Who knew.'Every professional trader'? Cmon, you can't be serious.
Ending dividends is not an option. That would be viewed as a terrible negative signal. The literature on this is vast, and the empirical evidence very strong.Re buybacks, if management does not have good ideas on how to spend the cash, it's best they give it back to the shareholders. Shareholders can put it to better use (or refuse to partake in the buyback).
Any half-way bright high schooler knows that that stock prices are "a result of expectations of revenue and profit" going forward.Seriously, if someone thinks they have a handle on expectations based on some random news report, that's the type of person that shouldn't be in the market. But hey, as they say, it's a free country....
Did I hear that China was up 112%? If so, wow. Just wow.   Cash of $200B+. And gross margins of ~40%. Incredible.
As though these news explanations amount to a hill of beans.
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