Re:Almost 80% of Private Day Traders Lose Money
by bjacokes on Monday August 22, 2016 @03:43PM
(#12338858)
That's mostly true with growth stocks. If you buy Amazon trading at 300x earnings with the expectation that earnings will grow 50% per year over the next five years, then it's tough to say whether the price will be higher or lower if they meet your expectations.
Value trades rely a bit less on others' expectations. If you were to buy a company trading at 12x earnings with the expectation that earnings would grow 15% per year over the next five years, then it's pretty likely that if your expectations come to fruition then you'll make money on the trade.
Value trades rely a bit less on others' expectations. If you were to buy a company trading at 12x earnings with the expectation that earnings would grow 15% per year over the next five years, then it's pretty likely that if your expectations come to fruition then you'll make money on the trade.