Idea No 1 : Every Stock has a "Bargain Price" irrespective of quality of business

All stocks that are listed have a price . This price is often market discovered price arrived  on demand and supply  of that stock . This price  may have no relation to dynamics of business or its ability to generate future cash flows for business owners .

The value diversion  depends upon market optimism or pessimism in immediate future Though  none of the participants has ability to predict future, people form a view basis dominant news flow.

This creates a Concept of Bargain price for sales or purchases .

It is interesting to look at  Hindustan Unilever price history  whose business is  least effected by business cycles and regulatory polices .Pl note  how much swing it has within one  year which is as high as 50% even after excluding for years when it had some corporate action to influence the price . This present enormous opportunity for active investors who believe to wait for Right Ball to Strike



Let us look at business that is impacted by Business Cycles & high debts  like Tata Steel . This presents even bigger opportunity for individual who believes that Steel is critical for India to grow and unfortunately India has very few good players who possess group level Moat to last through multiple business cycles and high interest rates . This stocks moves by 10 to 20 times in one business cycle of 5 - 10 year ie virtually doubling every year from its bottom value . So how does one catch bargain price  in both cyclical and non cyclical business ??

Next  9 week articles on Crazy Ideas will reveal some of the strategies to get arrive at  Bargain price range for any business