maybe those brokers and analysts want market itself running for few days, then they value the company against the actual market sp.
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maybe those brokers and analysts want market itself running for few days, then they value the company against the actual market sp.
Craigs downgrade out, TP $5.30 or thereabouts
A$6.0 level just broken.
China population 2021: births may drop to lowest on record
- Analysis of local government data showed that newborns may have fallen by 17 per cent in some regions in the first half of the year
- Chinese mothers gave birth to 12 million babies last year, down from 14.65 million in 2019, marking an 18 per cent decline year on year
https://www.scmp.com/economy/china-e...cord-jefferies
Guess the previous comments in this thread with SP $3.50 based off expected PE 11-15 is very much a reality. Will we see a new low somewhere between $3.50 and $5. Shorts will likely be coming out of the wood work again. Haven't got into shorts with my trading to date, but maybe now is a good opportunity to start with ATM.
Got the setup I was waiting for this morning with a small bounce on Aussie open to set a 15m and 1hr lower high. Shorted into resistance at AU$6.18 and covered on a pivot at AU$5.92. Looking to short more lower highs and long a bounce of AU$5.80 (or even better a break of this into a bounce).
Can investors succeed by relying solely on Broker forecasts or their buy/sell activities?
..There was a debate (actually more like a big argument) a long time ago (2013?) as to how accurate Broker forecasts ended up being. Somewhere back on Sharetrader or maybe Sharechat, Phaedrus used his Metastock program to test the correlation between forecast v actual price. The results showed a mediocre correlation..That created the argument :D. . I did a similar thing manually by plotting past forecast data with actual price on charts and eyeballing the results.
Back in 2013 when I plotted the forecast price data with the actual stocks price I found an interesting lag correlation ..Broker forecasts were above the actual price (over optimistic) most of the time during Bear market cycles and below the actual price (over pessimistic) during bull market cycles..
This resulted in investors using broker forecasts perceiving the stock prices were "cheap" during a down trending period ( outgoing tide...Bear cycle)
Also noticed was their forecasting was more conservative than the actual price event both up and down..and to correct that conservatism they would chase the actual price by updating their forecast creating a lag effect...This is evident when the stock reverses and "comes right" ...investors miss the golden opportunity to invest near the bottom because updated broker's price forecasts are still pessimistic..
Fast forward to 2021..I'm not sure if broker forecasts v actual stock prices now are similar or different to many examples of 2013
But...Interesting ..huh:)
Psychology-wise.. It seems to be a "Human Thing" a sub-conscious bias by relying too much on the past up to the present when formulating a forecast..
An example below is 2012 - 2013 FBU price v Macquaries forecast target price chart..Also Note the PE Ratio rise against the pessimistic forecasting.
Attachment 12889
An interesting discussion on analysts which has confirmed my thinking and answered my (somewhat rhetorical) questions above. What this highlights to me is that any analytical work or target SP produced by a broking house is not worth the paper it is written on. Yeah they can get some credit for collating some of the macro trends, but the micro stuff?......useless. The cynical side of me thinks the target prices are there to drive activity....qui bono? (definitely rhetorical)