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Hi Duc,

I have no question or doubt in my mind as to your knowledge and abilities with respect to FA, but find it interesting that you subscribe to the above view. That doesn't mean the above view is always incorrect, but I fail to see how you can refer to it as a truism.

If it was, stock analysts using an FA based approach should get it right more times than they appear to. But, if course if you wait long enough it may become true, as in a self fulfilling prophecy. Then again it may not, so how long do you wait before you move on.

In a perfectly ideal world I may agree with you, but in the real/practical world I would consider it a potentially flawed or limited view. Has the feel of an EMH/MPF view of the markets.

Have you considered factors that can have a lead-lag effect on the market an stocks dependent upon industry or company size?

Delays in dissemination of information can also have a lead or lag effect. An ealry receiver of the information may experience lead effect, whereas a late receiver of the information may experience a lag effect, as they have received the infromation after the event and the market has already reacted. This can also have an impact on economic indicators.

Market sentiment may play a role where the fundamentals will effectively lag the market. In this regard, market participants may form a negative view of a company and the fundamentals may not confirm or reflect this until some later time.

Consider Enron, which came first the market negative reaction/sentiment or the news that confirmed there was an issue with the fundamentals?

Depending where comapnies sit in the supply chain may also be factor as to whether fundamentals lead or lag the market. A change in commodity pricing can have an effect on industreis that rely on these commodities and the real effect of those changes may see the reaction exhibited in the market pricing before it shows up in the fundamentals.

It also relies on full disclosure and all relevant facts being provided in the company report and associated financial statements. Of course, no creative accounting is occuring.

It may be argued that company reports and finacial reports are correct at the time they are produced, but then how long are they valid for. There is also an inherent delay between the time related to preparing and finalising the report before it is officially released.

Just a few thoughts and comments for now.

Cheers,
Les.

<blockquote data-quote="lesm" data-source="post: 137337" data-attributes="member: 2798">Hi Duc,I have no question or doubt in my mind as to your knowledge and abilities with respect to FA, but find it interesting that you subscribe to the above view. That doesn&#039;t mean the above view is always incorrect, but I fail to see how you can refer to it as a truism.If it was, stock analysts using an FA based approach should get it right more times than they appear to. But, if course if you wait long enough it may become true, as in a self fulfilling prophecy. Then again it may not, so how long do you wait before you move on.In a perfectly ideal world I may agree with you, but in the real/practical world I would consider it a potentially flawed or limited view. Has the feel of an EMH/MPF view of the markets.Have you considered factors that can have a lead-lag effect on the market an stocks dependent upon industry or company size?Delays in dissemination of information can also have a lead or lag effect. An ealry receiver of the information may experience lead effect, whereas a late receiver of the information may experience a lag effect, as they have received the infromation after the event and the market has already reacted. This can also have an impact on economic indicators.Market sentiment may play a role where the fundamentals will effectively lag the market. In this regard, market participants may form a negative view of a company and the fundamentals may not confirm or reflect this until some later time.Consider Enron, which came first the market negative reaction/sentiment or the news that confirmed there was an issue with the fundamentals?Depending where comapnies sit in the supply chain may also be factor as to whether fundamentals lead or lag the market. A change in commodity pricing can have an effect on industreis that rely on these commodities and the real effect of those changes may see the reaction exhibited in the market pricing before it shows up in the fundamentals.It also relies on full disclosure and all relevant facts being provided in the company report and associated financial statements. Of course, no creative accounting is occuring.&nbsp; <img src="data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7" class="smilie smilie--sprite smilie--sprite11" alt=":rolleyes:" title="Roll Eyes&nbsp; &nbsp; :rolleyes:" loading="lazy" data-shortname=":rolleyes:" />It may be argued that company reports and finacial reports are correct at the time they are produced, but then how long are they valid for. There is also an inherent delay between the time related to preparing and finalising the report before it is officially released.Just a few thoughts and comments for now.Cheers,Les.</blockquote>

[QUOTE="lesm, post: 137337, member: 2798"] Hi Duc, I have no question or doubt in my mind as to your knowledge and abilities with respect to FA, but find it interesting that you subscribe to the above view. That doesn't mean the above view is always incorrect, but I fail to see how you can refer to it as a truism. If it was, stock analysts using an FA based approach should get it right more times than they appear to. But, if course if you wait long enough it may become true, as in a self fulfilling prophecy. Then again it may not, so how long do you wait before you move on. In a perfectly ideal world I may agree with you, but in the real/practical world I would consider it a potentially flawed or limited view. Has the feel of an EMH/MPF view of the markets. Have you considered factors that can have a lead-lag effect on the market an stocks dependent upon industry or company size? Delays in dissemination of information can also have a lead or lag effect. An ealry receiver of the information may experience lead effect, whereas a late receiver of the information may experience a lag effect, as they have received the infromation after the event and the market has already reacted. This can also have an impact on economic indicators. Market sentiment may play a role where the fundamentals will effectively lag the market. In this regard, market participants may form a negative view of a company and the fundamentals may not confirm or reflect this until some later time. Consider Enron, which came first the market negative reaction/sentiment or the news that confirmed there was an issue with the fundamentals? Depending where comapnies sit in the supply chain may also be factor as to whether fundamentals lead or lag the market. A change in commodity pricing can have an effect on industreis that rely on these commodities and the real effect of those changes may see the reaction exhibited in the market pricing before it shows up in the fundamentals. It also relies on full disclosure and all relevant facts being provided in the company report and associated financial statements. Of course, no creative accounting is occuring. :rolleyes: It may be argued that company reports and finacial reports are correct at the time they are produced, but then how long are they valid for. There is also an inherent delay between the time related to preparing and finalising the report before it is officially released. Just a few thoughts and comments for now. Cheers, Les. [/QUOTE]

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