Just go out and buy some shares of Wall Street's favorite highflier and see what the party is all about. Unfortunately, those stocks are priced in such a way that the rosy outlook for the next few years, at least, is accepted as a given. And at this point, an investor is unlikely to make much, if any, money. You're paying a hefty price for consensus and a future that the market is certain will be outstanding. The greatest risks actually lie in buying into a company when everyone agrees that it's a sure thing.
The key is to understand the market perception of the stock before buying, identify what needs to happen for that market perception to change, and, on some level, determine the probability of this expectation coming to fruition. Identify that probability trigger point to the extent that a defining "trigger point" exists, because it's sometimes much more subtle and the associated likelihood of its occurrence, so that you can assess the company's prospects in a given sequence of events.
If you understand the trigger points and why the market is treating the company the way it is, then it's easier to hold through thick and thin. In fairness, when or if the market comes to realize your perception, it bears mentioning that this isn't necessarily a sell or buy signal. Instead, consider this an opportunity to reevaluate the company's intrinsic value and prospects relative to the market perception of the company. If the margin of safety is too small for comfort, or if Wall Street seems to be getting unduly optimistic, it might well be time to take some off the table.
By taking the long-term approach, investors can afford to outwait their formerly impatient selves. In an ideal-case situation, investors will likely find themselves holding more winners instead of selling them at just the wrong time. At Motley Fool Inside Value , lead analyst Philip Durell is generously offering a free day trial to anyone who wants to sign up.
Stephen Ellis welcomes your feedback at steve gmail. He owns none of the stocks in this article, not even Google sigh! Ask yourself the following questions:. Skip to main content. Start your free trial. The sample variant data set for this demo is provided by Dr. Linda Chang and Dr. Gerben Duns. Mutations happen very frequently, but only sometimes change the characteristics of the virus. Lineage: A lineage is a group of closely related viruses with a common ancestor.
Variant: A variant is a viral genome genetic code that may contain one or more mutations. In some cases, a group of variants with similar genetic changes, such as a lineage or group of lineages, may be designated by public health organizations as a Variant of Concern or a Variant of Interest due to shared attributes and characteristics that may require public health action. Possible attributes of a variant of interest: Specific genetic markers that are predicted to affect transmission, diagnostics, therapeutics, or immune escape.
Evidence that it is the cause of an increased proportion of cases or unique outbreak clusters. Limited prevalence or expansion in the US or in other countries. Variant of Concern VOC A variant for which there is evidence of an increase in transmissibility, more severe disease e. Possible attributes of a variant of concern: In addition to the possible attributes of a variant of interest Evidence of impact on diagnostics, treatments, or vaccines Widespread interference with diagnostic test targets Evidence of substantially decreased susceptibility to one or more class of therapies Evidence of significant decreased neutralization by antibodies generated during previous infection or vaccination Evidence of reduced vaccine-induced protection from severe disease Evidence of increased transmissibility Evidence of increased disease severity Variants of concern might require one or more appropriate public health actions, such as notification to WHO under the International Health Regulations, reporting to CDC, local or regional efforts to control spread, increased testing, or research to determine the effectiveness of vaccines and treatments against the variant.
Footnotes for Variants of Concern. Regional Proportions b Region 1. Zhou, B. Nature Cell ; Cell ; 3 : MedRXiv BioXRiv BioRxiv MedRxiv The Lancet. Retrieved from: pdf cmmid.
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