Growth Of The Company Behind A Stock
Maraming traders even investors na nag ooperate sa idea na hindi naman kanila.
Today ay bibigyan natin ng linaw yan.
Let me start by telling you a story.
A young couple, happily married, is celebrating their first Thanksgiving together. The bride wants to cook her husband her family’s classic turkey recipe, and asks her mother for the recipe.
Her mother sends her the recipe, and the woman cooks it to perfection. Even the breast-meat is perfectly tender and juicy. However, at the end, her husband remarks: “Darling, where are the legs? I always liked those best.”
“There on the side,” she tells him.
He picks around the bird, and he seems still confused, so she points them out to him. He asks, “but love, why are they shaped like this? They don’t look like drumsticks to me. They’re all… squashed-y?”
She says, “It’s in the recipe. You take the legs off, take the bones out, and cook the meat on the side.”
He still doesn’t understand, but the turkey was very tasty, so he leaves it be.
The next day, the woman calls up her mother and asks, “So mom, about that turkey recipe. Why do we take the bones out and cook the meat on the side?”
Her mother replies, “Hm, I don’t actually know why. Your grandmother just always did it that way, and it’s her recipe.”
The mother and grandmother are having a pleasant brunch one morning, and the question of the turkey comes up once more.
“Oh, right,” says the mother. “Ma, I gave my daughter your turkey recipe, and she asked about the turkey legs.”
“What about them?” asked the grandmother.
“Well, why do we cut them off, take the bones out, and cook the meat on the side?”
The grandmother bursts into gales of laughter. “I did that when you were a kid because my pan was too small to fit the whole turkey!”
Sa stock market ganun din. Most ng idea na meron ka ay hindi talaga sayo.
You were told to buy good companies and your money will grow as the company grows.
When someone says that they buy a stock kasi gusto nila mag grow ang company, most do not even understand what they are saying.
Let me give you a real-life example.
Let us take MerryMart (MM) and Double Dragon (DD)
Both of these companies grew. Si MM konti lang ang stores at sales niyan nung nag IPO and ngayon marami na.
It went as high as 8.5 pesos plus and ngayon nasa 1.31 pesos.
New stores are being built by MM to this day. They are growing.
Pero if you happen to have bought MM at 8 or even 5 pesos ay mahigit 50 percent pa rin ang loss mo while the company grows.
Natanong mo na ba sarili mo kung ano ba talaga ang punta mo sa stock market?
Was it really to see companies grow or was it for your money to grow?
Kase I do not believe na pumasok ka sa stock market para panoorin maging successful ang mga company at maging richer ang mga dati nang rich owners ng companies na mga ito.
They may led you to believe na you are “part owner” ng company but you and I both know na owning little shares is not really owning anything. You have no idea or even influence on the day-to-day operation of something you “owned.” Kahit nga magtanong lang sa any update on projects or bagong news ay mahihirapan ka pa sa something na you “owned.”
You pay taxes right? Taxes pay for all the goverment employees. You may feel na ikaw nagpapasahod sa kanila but that do not mean you will give them orders.
If nasa stock market ka na ay di ko na nga dapat pinapaliwanag what owning a stock actually mean. Alam mo na dapat yun.
Believe or not pero hindi lahat ng companies na growing ay tumataas ang stock price. Hindi rin lahat ng di nagrow ay bumabagsak ang stock price.
Take MPI and MEG for example. They are growing for years yet their stock price is more or less stagnant.
Take PAL for example. Nagfile ng bankruptcy noong September 2021 pero mas mataas pa stock price niya ngayon compared before siya nagfile ng bankruptcy.
Maraming negative ang earnings na stock na umaangat ang stock price.
How do you explain that?
If your money grows with the growth of the company, how do you explain the growth of those companies that do not even earn or grow?
Isa lang ang paliwanag doon.
Growth ng company is not the main reason why a stock price go up and down.
If it was then sana lahat naging investor na.
There are a lot of reasons why stock prices move. Pwedeng growth ng company. Pwedeng news. Pwedeng technicals. Pwedeng other reasons.
Dahil sa dami ng pwede ay nagiging impossible mapredict ang galaw ng stock price.
Kaya ang nangyayare ay nagiging game of probabilities na lang siya.
Have you heard about that idea?
Well, let me share with you kung ano yan siya and also give you new trading strategies sa September 30.
Yes, I’m inviting you to join us sa September 30 on THE BERZERK SYSTEM course.
Its both a game changer and a life-changing course.
Kahit itry mo lang. Di mo naman need maniwala agad. Try mo lang. You at least owe it to yourself na itry. If di ka naniwala after edi ok but at least you gave yourself a chance na itry.
Those na nagtry nakaraan have something to show after. Here it is.
Try mo, you deserve this one.