The Articles I like

January 27, 2010

“Is It Here Yet? A Few Unnerving Developments Point to a Correction” by James D. Steward on The Wall Street Journal

“One of the fundamental conundrums of investing is that we may be absolutely correct about something and yet unable to profit. Making money on an insight requires two conditions: the information cannot already be priced into the market, and other investors who do not already share that information must come around to our point of view.

There are times when the conventional wisdom about something may well be correct. If the conventional wisdom is already reflected in market prices, then profit opportunities are slim to nonexistent….”