It is still rather difficult, without the use of ADR’s, to trade in other markets outside the US. But the good news is that there are ample ADR’s and funds linked to foreign index levels. So investing overseas is, for the most part, relatively easy. However, it is not without risk. There are all of the obvious risks in any equity but international equities add the risks of currency and country.
All posts by Dr. Douglas Rice
Intrinsic value
There are securities that aren’t trading at their intrinsic value and if one can identify them they may have an edge. The problem is that the market may not recognize this undervalution anytime soon. So buying undervalued stocks is a waiting game that most traders don’t have the luxury of playing for long. To put it another way, just because an analyst is correct, they market may not recognize it and therefore they may not make money on the information. For example, Julian Robertson ran a huge hedge fund called Tiger funds. He knew tech stocks were overvalued and shorted them accordingly. But the market went the other way and he lost billions and closed the fund. He was right in the long term but he bet short term and couldn’t stand the volatility in between. (just a thought)
Audit committee
Does it worry anyone that they only need one financial expert on the audit committee? Should all the members of the committee know what is going on? What would there purpose be if they didn’t understand the audit process? Kinda scary that we need a law to have a financial expert on the audit committee. 😉
Dr. Douglas Rice 