Post #19 by MisterFungi on the Software as a Service Gems board

Investment Strategies / Software as a Service Gems

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...it's difficult to know when over-valued stocks will be punished. Eventually, they will be (unless they grow into that valuation). Could be tomorrow. Or next year. Or five years from now. I read Saul's board, but I don't converse with him at all (I'm not one of the "cool kids"). But from my reading, I think this is what he means about timing the market.

Perhaps that is what he means, but that doesn't make it an appropriate use of the phrase. Nor does it justify taking the extreme position of declaring any and all mentions of valuation verboten (unless he's doing it, such as declaring some of his stocks as being "oversold," repeatedly.) Moreover, one is not even permitted to ask a question about what rates of revenue growth, net margins, share counts, etc., would be required over the next 5, 10, of however many years in order for the current share price to be even remotely justified.

Bottom line: Taking valuation into consideration when buying or selling a stock is entirely distinct from attempts to "time the market."

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