tag:blogger.com,1999:blog-13876278.post5813759537901548712..comments2023-07-13T05:12:57.937-07:00Comments on MarketPsych: Applying Behavioral Finance: The Wicked Garden Effect (TM)Anonymoushttp://www.blogger.com/profile/03622698135652409361noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-13876278.post-16124559840695241452008-09-23T06:55:00.000-07:002008-09-23T06:55:00.000-07:00Hello, a little question from a brazilian value in...Hello, a little question from a brazilian value investor (so may I be excused if I miswrite sth?)...<BR/><BR/>That reasoning is, indeed, common in a lot of books about financial behavior. However, consider this:<BR/><BR/>The investor bought both A and B stocks after running a thorough, conservative, DCF analisys and found them both to be trading at a 50% discount. <BR/><BR/>The underlying fundamentals have not changed, and, as you said, A is 25% up and B is 25% down. <BR/><BR/>How could I decide to sell B knowing it is soooo undervalued?<BR/>If I do trust my analisys perhaps I should sell A and buy B. <BR/><BR/>I must add that here in Brazil, the small investor will not be taxed in stock market capital gains, under certain conditions.<BR/><BR/>That is why i just cannot agree with that reasoning. <BR/><BR/>Regards, LafayetteLafayettehttps://www.blogger.com/profile/09367449447561063857noreply@blogger.com