STE's Stocks Investing Journey

  As a value investor, we focus on investing in stocks or any other assets that we believe are undervalued relative to their intrinsic or fundamental value. This approach to investing is often associated with the principles of gurus like Benjamin Graham and Warren Buffett . We often use fundamental analysis with a margin of safety, looking at ratios or figures like PE, PB, EPS Growth, Cash flow, etc . We emphasize investing in the long term, avoiding speculation, and having a diversified portfolio. We also understand that value investing requires patience and discipline. Investors may need to wait for the market to recognize the true value of their investments, which can take time, and recognize the ultimate force of “ reversion to mean”. It's important to note that value investing is a well-established investment strategy, but it is not without risks. It can take time for undervalued assets to appreciate and realize their value, and there is always the possibility that the mark...

  Stocks Valuation: Art or Science?   This is an “old age “ question that pondered all of us as an investor and question we hear from time to time. For me, I think stocks valuation is both a science and an art. We often hear that analysts are trying to find the so-called ”intrinsic value ” of a stock or business and different model or methods of analysis would give a different result of valuations, sometimes the variance could be huge.   <Image Credit: Mishfitlife.com> Beauty (Value) Is In The Eye of The Beholder: Part 1     Valuation is a science because there are “ scientific element ” involved in methods of valuation e.g using DCF (Discounted Cash Flow ), SOTP ( Sum-of the parts  ), Asset-Based Model (Relative Valuation ),  Financial Ratio analysis (PB/PE/Div Yield etc ). Valuation is an art because it involved “judgement “ about the prospect or future of any company. It is always as subjective as art when it comes to “ estimating...

Value is a better measure for investors while price matters more to traders We, the so-called “value investors” often find ourselves trying to resolve the differences between a stock's value and its price. If you have spent any time investing in the stock market, you will know that value and price are two different measures arrived at by different means but most of the time we might confuse and mix up “price as value”.

《每个人心中都有一把尺 》 We often look at things by setting our own standards and base on our own yardsticks and the same applies to the company’s valuation. Everyone may have their biases when comes to valuation and value is more than just a number. All Valuation is Biased !! According to Aswath Damodaran ( a Professor of Finance at NYU’s Stern School of Business ) in his book “ The Little Book of Valuation “ try to warn us that “all valuation is subjected to biased “. “ You almost never start valuing a company or stock with a blank slate. All too often, you view on a company or stock are formed before you start inputting the numbers into the model and metrics that you use and not surprisingly, your conclusions tend to reflect your biases. The bias in the process starts with the companies you choose to value.