Post by
68Charger1 on Jul 31, 2024 9:11am
FDR and traders’ capital
Long and strong FDR, or opportunistic trader? How can one tell the best policy at this juncture?
Anyone who owns Founders probably understands the idea of efficiently employing his investment capital. In other words, if a stock is liquid enough to allow a buyer to establish a new holding (or painlessly exit) at any time, current shareholders must implicitly believe there is no better, faster return expected elsewhere. Right?
The application of this guiding philosophy is what allows successful active traders to make such eye-popping returns on occasion. It’s almost a fifth dimension. And it’s not like we all don’t see it, or at least its reflection. In hindsight, the profits we might have made if our timing had been perfect jumping between a few active stocks look astonishing. It’s the actual execution of said strategy that separates the professionals from the amateurs.
All of which makes FDR such a perfect laboratory for observing the collision of this idea with the other general truism of it being best to let winners run. Or, put differently, to not get shaken off the bull.
Because it is so psychologically hard to get back in. Liquidity is a necessary but not sufficient condition for successful active trading… one must also defeat the fear and greed/FOMO in one’s own mind.
Yes, Founders may produce some mouth-watering results from Buese in the near future. How much is priced in already? Not very much, I think. I have shown you my own price target estimates, and their supporting methodology and assumptions, and other shareholders have stated theirs. We even have a few analysts’ views, cautious ones, mind you, as is the way of their profession.
I don’t know where people think they will get a better and more certain short-term return at present. But I am no doubt biased from owning a lot of FDR and following the story so closely. If the initial Buese results disappoint, it may create a trading opportunity for those who exit today.
Or not.
From bitter experience, I know my own limitations regarding timing ability. It takes buyers and sellers to make a market, sure, but usually they can’t both be happy in the days or months after a transaction. On to Buese, everyone.