For long-term investors:
a) If I believed in Cu6 at $6 and nothing has fundamentally changed, then at $3, I should love it even more. It’s essentially getting two shares for the price of one. If the market was correct at $6, then I’ll gladly take the discount. Buying on the up is fine too: Those who missed out on Telix at $5, but bought at $12, are 100% up.
b) We must remember: A stock represents a company, not just a price. As long as the company continues executing on the reasons I invested in the first place, and my conviction remains strong, it’s a buy, not a sell. That for me is why hours spent researching the company (not its stock or market behaviour), feels worthwhile.
c) The idea that "the market is always right" about pricing is completely flawed. If that were true, NEU wouldn’t have dropped from $25 to $12 when it did, and Telix wouldn’t have moved from $31 to $27 in days. At best, the market was wrong before or after those price moves, if not both! To me, this is proof that the market doesn’t always know the correct sp for any stock.
Take RAC, for example: it halved from $2 to $1, as if its entire value had suddenly been cut in half. Cu6 ran from $3 to $8 and back to $3, yet the company’s assets and total addressable market (TAM) have only grown.
Think about the strategies people use, like the buy low, sell high, or even momentum investing. Both exist because the market misprices stocks!
Good luck to all!
(20min delay)