10. Stock Market Crash and Market Bubbles

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Download Preston’s 1 page checklist for finding great stock picks: http://buffettsbooks.com/checklist

Preston Pysh is the #1 selling Amazon author of two books on Warren Buffett. The books can be found at the following location:

http://www.amazon.com/gp/product/0982967624/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=0982967624&linkCode=as2&tag=pypull-20&linkId=EOHYVY7DPUCW3WD4

http://www.amazon.com/gp/product/1939370159/ref=as_li_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=1939370159&linkCode=as2&tag=pypull-20&linkId=XRE5CA2QJ3I2OWSW

In Unit 3, Lesson 2, we learned about psychology of the stock market and how most traders rely on instincts opposed to value in order to conduct trading. We learned a very important quote from Benjamin Graham that states, ìThe stock Market behaves like a voting machine, but in the long term it acts like a weighing machine.î This idea is important for value investors to understand as they remain confident in their valuation of any asset during emotional times.

During this lesson, we provided a demonstration of an emotional trader and a value trader. As you could see in the video, the value trader almost always had the opposite opinion of the emotional trader. This is important to remember as you move into the second course of this website. Determining the intrinsic value of a stock will help provide a peace of mind and ability to make clear decisions.

Comments

bipolar1989m says:

thumbs up for this mate

orestesdd says:

Preston, how did Amy figure out that the stock was worth $22 just by looking at its earnings of $2 and $18 book value?  Is the $18 book value the same as P/B ratio?  Is the (P/E)*(P/B) < 22.5 for this fictional stock?  Thanks for this video.

Lucky Singh says:

so thankyou…

Remi Silva says:

Thank you Preston Pysh for these videos, they are very helpful…

Duy Leon Hoang (duyleonhoang) says:

in those clothes, you would not get into "the best club on the planet" 😀 +1 for the video

ashish kumar patel says:

I didn't use to do financial review. . But I always buy near Lewsey price in the range of time I plan to hold I know it s wrong now. I'm a trevor

Vincent Vata says:

Is it possible to be a value investor for short or medium term buys(from a a day to 1 month)?

Vinay Wadhwa says:

Trevor is Mr Market's blood relative. Crazy!

Anil Tambvekar says:

Every time I watch your video I hit a Like button 🙂
Keep doing good work!!

Іра Павленко says:

Thank u ! thank u! thank u! 
But… the question is – what if everybody will value and smart investors? 
The market will just stop untill somebody will need to sell shares becouse they need money? because nobody will buy expensive shares, so Amy will not have posibility to sell shares. or how?)

Alex Manzano says:

I was scared that you weren't going to teach how to calculate intrinsic value, and then I saw the end of the video and phew! On to course two! Thanks for all this KNOWLEDGE!

Brodne y says:

Thanks for these videos, I haven't started investing yet but i plan to start during next year, I need to acumulate some knowledge first and these videos are really helpful

Top 5 says:

Thank you +Preston Pysh 

Nilay Debnath says:

I m ur fan

Mn Chu says:

not too late, i just understand i was emotion based investor, this was the reason I lost  mostly in stock investing. It's too late. Thanks Preston and Warren

Thomas Jacob says:

txs for the teaching

Anuj Chauhan says:

dude u are awssom … i dont know why are u doing this ……….i mead knowledge is a one time investment …..i am gonna be like  you and mr buffet …. u have helped me alot thanxxxx…..
keep it up..

superAweber says:

Thank you Preston Pysh.

Richard's World says:

I'd like to buy some of Amy.

Afif Farabi Megat says:

amy is sexy tho

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