Is this market over priced?

Discussion in 'Trading' started by tradingjournals, Jul 20, 2011.

  1. Do you find this market overpriced? Could you share your thoughts? I looked at the fancy stocks such as apple and amazon. I find them overpriced (particularly amazon). Why are people buying them?

    Could you share stocks you find overpriced?
  2. NFLX, CMG, LULU - are often mentioned on ET.
  3. Lucias


    The first rule of logic is that one thing can only be measured in relation to another. So for a price to make any sense at all then it must be related to some other measure.

    Now, in terms of relations.. I have seen many valuation models that will say either a market is over or under priced. But, when I've looked at any of them.. I noticed a few things:

    A. The market tended to stay over priced more of the time then under priced
    B. Markets went from under priced to more under priced.

    A better question to ask is the market going to go up or down, I think. Also, it is more important to focus on long opportunities then short opportunities because long opportunities have a much greater potential.

    If I had to pick one stock that should take a knife off the cliff then I'd choose LNKD because I don't believe anyone uses that website and do not think they will be able to grow or stay relevant with increased competition.

  4. I will check them. Thanks.

    My interest in AAPL and AMZN is mainly because they are in the indices (qqq for instance).

    Did anyone notice that both closed at bottom of range today? Is it saying something? Amazon has low margins.
  5. I have never checked that stock (I know the site). I do not believe in that site future. Did you notice the low margins and huge PE?

    Excellent comments Lucias!
  6. JSim


    I agree LNKD is overpriced but i do see a future for it.

    I don't think the concerning competition is Facebook and Google. Most people use LNKD for job hunting and professional connections. MWW, is more analogous. They also require a paid subscription for many of their more useful services where Facebook and LNKD is, technically, free.