Originally Posted by
PSE
Busy thread :)
Couta yes if the business is still sound and all that has changed is the shareprice then absolutely it is just noise. Daytr, Stoploss, Twotic absolutely the Macro environment will impact on shares. From an electrical engineering perspective noise is any unwanted information that is masking useful data - this is the information the sharemarket is focusing on because the future is unknowable.
Rather than worrying about China, Greece, Oil Prices, Syria, IS, Obama, Bird Flu, Swine Flu, Ebola, Lehman Brothers people need to focus on the knowable aspects that affect their companies.
All this noise confuses people not just by drowning out the relevant information by playing on their emotions, leading them to think that shares are risky just when they are cheap and safe. Conversely during a bubble everyone is convinced shares are safe just when they are at their most perilous and expensive.
I agree with Couta's thinking, if you can hold for 5 years then a paper loss is meaningless. I have to add it has been very hard to find good value stocks lately so if you bought pricey ones then you may miss the opportunity to buy cheap ones.
Stoploss - Peter Lynch never used a stoploss in his life and neither have I. With my luck the shareprice will fall 10% trigger the stoploss and take me out just before the company rises 300%.
I don't know why you would buy a company thinking to sell it if the shareprice falls, the idea is to sell when the price rises and the only way to guarantee that will happen is buy and hold through the fluctuations.
Boring old get rich slow.