tianxin

the show NY Wrote:
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> theyre 2 different questions actually:
>
> Q1: forecasted return is 11%, but required return
> is 14%. this is not a good investment
> (overvalued) so sell.
>
> Q2: required return should be lets say 15% (this
> is whats used to derive our intrinsic value). but
> in the market its too high (lets say 18%). this
> makes the stock in the market cheaper than what we
> are valuing it at (due to higher r in the
> denominoator). so now the stock is undervalued
> (we valued it higher than its current price), and
> we buy it until the price rises to equilibrium r.
>
> bpdulog: i think this is what you were alluding
> to?

Yup.

NO EXCUSES