One of the most interesting characters for me has been Sherlock Holmes. Lot can be learnt from him, which can be made applicable to our lives, including Investing:
“There are some trees, which grow to a certain height, and then suddenly develop some unsightly eccentricity. You will see it often in humans and in stocks” (Underline added by me).
This typically is found in companies or in industries which see Value Migration, i.e. flow of economic and shareholder value away from obsolete business models to new, more effective designs that are better able to satisfy customers’ most important priorities.
For example, Economic Value shifted to Electronic Vehicles from the traditional internal combustion vehicle manufacturers. This resulted in Tesla’s market value zooming past that of GM and Ford – combined last week.
Have you identified Value Migration in your industry yet?
Disclaimer: Please note that these are my personal views. While I am NOT a registered Research Analyst as per SEBI (Research Analyst) Regulations, 2014. All investors are advised to conduct their own independent research into individual stocks or industries before making any decision. In addition, investors are advised that past stock performance is not indicative of future price action.