Overhyping a stock

This is a bit late but the lesson is always there.

Couple months ago when Facebook stock was listed you clearly had signs that it will be overpriced.

Why?

I can't say about USA or Germany or the likes but here in Finland the news very rarely speak about stocks if it isn't Nokia. And they were CONSTANTLY talking about Facebook. Not just once or a couple of times, they mentioned Facebook every day.

If media mentions a stock often -> people will buy it -> it will be overpriced.

Lessons we can learn? Be very careful when buying new stocks that are just entering over-the-counter market. As a short term investment Facebook offered a good return, but that short term was under a day in this case, only some hours. Follow the media, and go against the crowd.

Yahoo news: Was the Facebook Deal Overhyped? 18th MAy, 2012

Sunday Culture

Katie Melua - The Flood

Great artist and a very interesting looking video.

Sunday Culture

Stumbled upon a nice little movie related to investing, called "Other people's money".

Danny DeVito Explaining Value Investing

A corporate raider threatens a hostile take-over of a "mom and pop" company. The patriarch of the company enlists the help of his wife's daughter, who is a lawyer, to try and protect the company. The raider is enamoured of her, and enjoys the thrust and parry of legal manoeuvring as he tries to win her heart.