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Don’t Let Stock Price Fool You: What Every Investor Should Know


Well, if some of you are starting to doubt your stock picks or have been impatient as to why the stock prices keeps going down or hasn't move, don't worry. It happens and somehow affects everyone including me.


Remember to always focus on the fundamentals of your company instead of share price movement. By fundamentals, I mean whether the revenue or cash flow is improving, have the management executed their plans, is there any future growth still, have the company strengthened their moat, etc.


Ultimately, ask yourself if the business is getting larger and the company is getting more valuable. As long as the metrics are improving or the company's moat is getting stronger, we are doing fine. Let the market worry on the news and share price movement.


Remember what Jeff Bezos said before, "The stock is not the company and the company is not the stock." At the end of the day, focus on your company's performance and per share value. Please do watch this short clip from the interview with Jeff Bezos from 24:58 and adopt his mindset: https://youtu.be/f3NBQcAqyu4?t=1498


All we need is time and patience for the market participants to wake up to reality. And when the day comes, the company's fundamentals will exert a magnetic pull like gravity on the share price to match its true value. Until then, continue reading up about your companies to build more conviction.

Daniel Lim

I help stock investors build wealth

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