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Before we get into it: I hope it is ok for the mod team if I link a video to Sven Carlin´s value investing channel here - if not, please let me know and I´ll remove it. After all it is no advertisement of mine or so, but as it goes, Carlin of course does promote his own research in his videos.
The link: [https://www.youtube.com/watch?v=UV9Ys584C6A&t=139s](https://www.youtube.com/watch?v=UV9Ys584C6A&t=139s)
This video just dropped today and it just perfectly discusses the issue I recently kept on criticising myself over and over again on this subreddit: People fail to understand that price does not define value and vice versa.
Your estimate of, let´s say, a P/E ratio, tells you nothing about fundamentals of a business. Analysts and their intrinsic value calculations tell you nothing about fundamentals. We have even reached a point in which stock price tags are used interchangeably with value, just like sentiment and hype are. This, with all due respect, is just insane.
Like many other stock- and investment-related subs, also this one gets flooded with the daily postings along the lines of "PayPal dropped 10% - buy now!" and what not.
The total disregard to market environments, competition and all is just crazy. I quote Carlin from the video: "We as value investors need to look at things differently." Exactly - but if you take a close look at all the content posted online, 99% of self-proclaimed "value investors" don´t do anything differently. They fail to control their emotions. They fail at conceptual thinking and risk-management. They juggle metrics until they fit a narrative their heads refuse to let go - and hence act out of confirmation bias rather than rationality.
I am not going to elaborate on the topic "momentum VS fundamentals" - that is also addressed in the video.
So yeah, especially for all the beginners here: Check out this video and really do some effort scrutinising your own personal bias. A lot of you folks keep asking for advice/opinions on here, but what good is that if one dismisses the hard facts a priori?
(Disclaimer: None of this is financial advice, just a personal opinion - do your own due diligence and research. I am not affiliated with the featured YouTube channel in any way, I simply like this video because it is a rational, factual approach to value investing).