Leading provider of independent small cap mining stocks and small cap junior mining stocks Investment Research. The idea behind intrinsic value equaling future profits makes sense if you think about how a business provides value for its owners. If you have a small business, its worth is the money you can take from the company year after year (not the growth of the stock). A business is all about profits, plain old revenue minus expenses - the basis of intrinsic value. One of the assumptions of the discounted cash flow theory is that people are rational, that nobody would buy a business for more than its future discounted cash flows. Leading provider of independent small cap mining stocks and small cap junior mining stocks Investment Research.
small cap mining stocks
small cap junior mining stocks
small cap investing
small cap growth stocks
small cap gold stocks
small cap stock research
small cap stock picks
small cap stock investing
small cap research
small cap oil stocks
But why, then, do stocks exhibit such volatile movements. Leading provider of independent small cap mining stocks and small cap junior mining stocks Investment Research. It doesn't make sense for a stock's price to fluctuate so much when the intrinsic value isn't changing by the minute. The fact is that many people do not view stocks as a representation of discounted cash flows, but as trading vehicles. Who cares what the cash flows are if you can sell the stock to somebody else for more than what you paid for it. Cynics of this approach have labeled it the greater fool theory, since the profit on a trade is not determined by a company's value, but about speculating whether you can sell to some other investor, or the fool. Leading provider of independent small cap mining stocks and small cap junior mining stocks Investment Research.