{"id":177027,"date":"2021-02-12T22:32:00","date_gmt":"2021-02-12T19:32:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/opinion-the-stock-market-seems-to-be-a-random-number-generator\/"},"modified":"2021-02-12T22:32:00","modified_gmt":"2021-02-12T19:32:00","slug":"opinion-the-stock-market-seems-to-be-a-random-number-generator","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/opinion-the-stock-market-seems-to-be-a-random-number-generator\/","title":{"rendered":"#\n  Opinion: The stock market seems to be a random number generator"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a403312ac3a3\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a403312ac3a3\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-the-stock-market-seems-to-be-a-random-number-generator\/#What_are_stocks_especially_small-cap_stocks_worth_these_days_No_one_knows_Which_is_why_discipline_will_soon_return_to_the_market_says_Cody_Willard\" >What are stocks, especially small-cap stocks, worth these days? No one knows. Which is why discipline will soon return to the market, says Cody Willard.<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-the-stock-market-seems-to-be-a-random-number-generator\/#Cody_Willard\" >Cody Willard<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Opinion: The stock market seems to be a random number generator<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"What_are_stocks_especially_small-cap_stocks_worth_these_days_No_one_knows_Which_is_why_discipline_will_soon_return_to_the_market_says_Cody_Willard\"><\/span>\n  What are stocks, especially small-cap stocks, worth these days? No one knows. Which is why discipline will soon return to the market, says Cody Willard.<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000165519\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       In case anybody needed a reminder that stocks are risky, don\u2019t always go straight up and huge losses can be real, consider cannabis stocks. On Feb. 11 they dropped as much as 50%. <\/p>\n<p> Look at this one-month chart, which seems as if it could be a <em>one-year<\/em> chart for the ETFMG Alternative Harvest ETF<br \/>\n        MJ,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/204332491\/composite\" class=\"positive\">+1.52%<\/bg-quote><span>,<\/span><br \/>\n       the largest exchange traded fund in the sector:<\/p>\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetMediaIllustration\n            inline\n  article__inset\n          article__inset--type-InsetMediaIllustration\n            article__inset--inline\n  \"><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        renoImageFormat-\n        img-inline\n        article__inset__image\n      \" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<div style=\"padding-bottom:85.46875%;\" data-mobile-ratio=\"85.46875%\" data-layout-ratio=\"85.46875%\" data-subtype=\"\" class=\"image-container  responsive-media article__inset__image__image\">\n        <img decoding=\"async\" srcset=\"https:\/\/images.mktw.net\/im-298712?width=140&amp;size=1.170018281535649 140w,\nhttps:\/\/images.mktw.net\/im-298712?width=540&amp;size=1.170018281535649 540w,\nhttps:\/\/images.mktw.net\/im-298712?width=620&amp;size=1.170018281535649 620w,\nhttps:\/\/images.mktw.net\/im-298712?width=700&amp;size=1.170018281535649 700w,\nhttps:\/\/images.mktw.net\/im-298712?width=860&amp;size=1.170018281535649 860w,\nhttps:\/\/images.mktw.net\/im-298712?width=1260&amp;size=1.170018281535649 1260w\" sizes=\"(max-width: 140px) 100px,\n(max-width: 540px) 500px,\n(max-width: 620px) 580px,\n(max-width: 700px) 660px,\n(max-width: 860px) 820px,\n1260px\" src=\"https:\/\/images.mktw.net\/im-298712?width=620&amp;size=1.170018281535649\" data-enlarge=\"https:\/\/images.mktw.net\/im-298712?width=1260&amp;size=1.170018281535649\" alt=\"\" title=\"\"><\/div><figcaption class=\"wsj-article-caption article__inset__image__caption\" itemprop=\"caption\"><span class=\"wsj-article-credit article__inset__image__caption__credit\" itemprop=\"creator\"><br \/>\n            (FactSet)<br \/>\n          <\/span><br \/>\n  <\/figcaption><\/figure>\n<\/div>\n<p>       <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/tradingwithcody.com\/wp-content\/uploads\/2021\/02\/Screen-Shot-2021-02-11-at-5.16.37-PM.png\" class=\"icon none\"><\/a><\/p>\n<div class=\"paywall\">\n       There are many small-cap stocks \u2014 not only in the cannabis sector \u2014 that are making big \u201ccandle sticks\u201d like that as they make 10%-30% moves intraday.<\/p>\n<p>The stock market seems to remain a random number generator. Some random small-cap stock might be worth $17 one day, $37 the next day, $79 the next morning and then close at $44. This is not investing. These are random numbers generated by a four-letter symbol machine.<\/p>\n<p>Here\u2019s another example of how random these numbers are right now, as subscribers in the chat room ask me this type of question over and over, as so many startup companies come public at huge valuations:<\/p>\n<p><em>\u201cCody, if Rivian and Lucid Motors go public, how much valuation will you give each of them. I just heard that Rivian is seeking a $50 billion valuation. Lucid claimed to have  [a] superior 900-volt electrical system. Both seem almost ready to start pushing products out.\u201d<\/em><\/p>\n<p>I have no idea how to value these companies. We\u2019ll need to see some revenue, some gross-margin projections and so on. Remember that when we bought Tesla Inc.<br \/>\n        TSLA,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/203558040\/composite\" class=\"negative\">-1.16%<\/bg-quote><br \/>\n       two years ago, that after a couple years of struggling to crank out the Model 3, it was being valued at $30 billion and trading at just over one times revenue.<\/p>\n<p>Nowadays, many of these startup electric-vehicle companies are being assigned valuations that rival Tesla\u2019s at that time but without the revenues or factories or established brands or burgeoning charging networks or <em>anything<\/em>. Is Lucid Motors, without any revenue or gross margins or unit sales yet currently valued at close to $10 billion, really worth 25% as much as Ford Motor Co.\u2019s<br \/>\n        F,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208911460\/composite\" class=\"negative\">-0.52%<\/bg-quote><br \/>\n       current $44 billion valuation?<\/p>\n<p>Rivian is clearly a great company. Amazon.com Inc.<br \/>\n        AMZN,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210331248\/composite\" class=\"negative\">-0.26%<\/bg-quote><br \/>\n        invested in Rivian\u2019s stock on the cheap a couple years ago and promised to buy a ton of vehicles from the company. I\u2019d like to invest in Rivian at a fair price that includes a margin of safety and lots of potential upside. I don\u2019t know what that means yet, because we need to get more financials and insights into the business model before I generate a random number for you.<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>\u201c<em>Discipline: an orderly or\u00a0<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.merriam-webster.com\/dictionary\/prescribe\" class=\"icon none\">prescribed<\/a>\u00a0conduct or pattern of behavior.\u201d<\/em><\/p>\n<p>I often talk about discipline when it comes to investing and trading. Discipline sounds like an outdated concept in this market. But discipline never goes out of style for long. Discipline will be back.<\/p>\n<p>C<em>ody Willard is a columnist for MarketWatch and editor of the Revolution Investing <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a>letter. Willard or his investment firm may own, or plan to own, securities mentioned in this column.<\/em><\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Cody Willard\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Cody_Willard\"><\/span>Cody Willard<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D2868FF3F975%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Opinion: The stock market seems to be a random number generator &#8221; What are stocks, especially small-cap stocks, worth these days? No one knows. Which is why discipline will soon return to the market, says Cody Willard. In case anybody needed a reminder that stocks are risky, don\u2019t always go straight up and huge&#8230;<\/p>\n","protected":false},"author":1,"featured_media":177028,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-177027","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/177027","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=177027"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/177027\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/177028"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=177027"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=177027"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=177027"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}