Investment analysis of the common stocks of selected California banks. - Page 169 |
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156 ,
I f t h e m a rk e t a s k e d p r i e e i s above t h e u p p e r l i m i t o f
t h e v a lu e ra n g e i t i s a s i g n a l to t h e i n v e s t o r t h a t he
may w ant t o s e l l th e s to c k i f he h a s i t , and n o t t o
p u rc h a s e t h a t s to c k a t t h e p r e s e n t t i m e . I f th e m a rk e t
a s k e d p r i e e f a l l s w i t h i n t h e v a lu e ra n g e th e i n v e s t o r
may c o n c lu d e t h a t i t i s n o t a good tim e t o s e l l — n e i t h e r
i
i s i t a good tim e t o b u y . I f t h e i n v e s t o r now owns t h i s
s to c k he may f i n d i t a d v a n ta g e o u s t o h o ld on t o i t . I f
i
t h e p r i c e i s b e lo w th e lo w e r l i m i t o f t h e v a lu e ra n g e i t |
i s a s i g n a l t h a t i t may be a good tim e t o buy t h e p a r - ;
t i c u l a r s t o c k . \
j An exam ple o f how th e v a lu e ra n g e ca n be u s e d t o
j form in v e s tm e n t d e c i s i o n s may be s e e n i n t h e r e s u l t s o f
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| t h e a n a l y s i s o f th e s e l e c t e d C a l i f o r n i a b a n k s . F i r s t
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i t m u st be rem em bered t h a t th e c o m p a ris o n o f t h e ra n g e
I o f v a lu e w ith th e m a rk e t p r i c e i s a s o f a c e r t a i n d a t e —
M arch 3 0 , 1 9 5 6 . Many c h a n g e s may h av e o c c u rr e d s in c e
-; t h a t d a te w hich c o u ld v e r y w e ll c a n c e l o u t an y e o n -
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| e l u s i o n s w hich a r e made on d a t a t h a t i s o u t d a t e d . The
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: i n v e s t o r m ust r e a l i z e t h a t t h e im p o rta n c e o f a n a n a l y s i s
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; su c h a s t h i s i s th e m eth o d u s e d t o a r r i v e a t a c o n c lu s io n ,
i
; an d n o t th e c o n c lu s io n i t s e l f . The m eth o d may be more
Object Description
Description
| Title | Investment analysis of the common stocks of selected California banks. - Page 169 |
| Repository email | cisadmin@lib.usc.edu |
| Full text | 156 , I f t h e m a rk e t a s k e d p r i e e i s above t h e u p p e r l i m i t o f t h e v a lu e ra n g e i t i s a s i g n a l to t h e i n v e s t o r t h a t he may w ant t o s e l l th e s to c k i f he h a s i t , and n o t t o p u rc h a s e t h a t s to c k a t t h e p r e s e n t t i m e . I f th e m a rk e t a s k e d p r i e e f a l l s w i t h i n t h e v a lu e ra n g e th e i n v e s t o r may c o n c lu d e t h a t i t i s n o t a good tim e t o s e l l — n e i t h e r i i s i t a good tim e t o b u y . I f t h e i n v e s t o r now owns t h i s s to c k he may f i n d i t a d v a n ta g e o u s t o h o ld on t o i t . I f i t h e p r i c e i s b e lo w th e lo w e r l i m i t o f t h e v a lu e ra n g e i t | i s a s i g n a l t h a t i t may be a good tim e t o buy t h e p a r - ; t i c u l a r s t o c k . \ j An exam ple o f how th e v a lu e ra n g e ca n be u s e d t o j form in v e s tm e n t d e c i s i o n s may be s e e n i n t h e r e s u l t s o f i | t h e a n a l y s i s o f th e s e l e c t e d C a l i f o r n i a b a n k s . F i r s t I i t m u st be rem em bered t h a t th e c o m p a ris o n o f t h e ra n g e I o f v a lu e w ith th e m a rk e t p r i c e i s a s o f a c e r t a i n d a t e — M arch 3 0 , 1 9 5 6 . Many c h a n g e s may h av e o c c u rr e d s in c e -; t h a t d a te w hich c o u ld v e r y w e ll c a n c e l o u t an y e o n - i | e l u s i o n s w hich a r e made on d a t a t h a t i s o u t d a t e d . The I : i n v e s t o r m ust r e a l i z e t h a t t h e im p o rta n c e o f a n a n a l y s i s I ; su c h a s t h i s i s th e m eth o d u s e d t o a r r i v e a t a c o n c lu s io n , i ; an d n o t th e c o n c lu s io n i t s e l f . The m eth o d may be more |
