{"title":"Buy Low, Sell High","authors":"Mike Chung","doi":"10.1002/9781119639695.ch27","DOIUrl":"https://doi.org/10.1002/9781119639695.ch27","url":null,"abstract":"\" Buy low, sell high \" is often quoted in finance. While its wisdom is hard to question, its application is hardly extensive. To understand why this is so, it is helpful to put ourselves in the shoes of a typical investor. Let's call him Joe. To Joe, \" buy low, sell high \" probably means: \" I'm gonna find the next hot thing and get it early when its stock price is low. \" While that's not a totally unreasonable target, such an endeavour is deeply flawed. To start with, for Joe to successfully find the \" next hot thing \" he needs extensive and specific business knowledge. Unless he is a genuine visionary (of the Steve Jobs type), chances are quite low that he has deep insights. Those who make a living trying to find the \" next hot thing \" are called venture capitalists and they expect to lose money on most projects and have a few pay off in a big way. Joe probably doesn't have the required resources to back a large number of investment prospects in the same manner as venture capitalists. But suppose that Joe does indeed stumble on the next hot thing. What are the odds that he will find it early enough? It would be tempting to say he has a better probability of winning the lottery. Even worse, by the time Joe buys shares of a hot stock in the open market, he has probably overpaid for them. After all, a hot stock is one that attracts excess attention from the trading public and therefore commands a hefty price premium. Moreover, the competitive advantage that made a hot stock perform in a stellar manner would most likely attract more competition. The economic law of diminishing returns would kick in resulting in a low likelihood of long-term profitability for the underlying business. For instance, Microsoft was one of the most prominent hot stocks of the 1990's. But since then competitors have caught up with the software giant and market participants are no longer feverishly buying its shares. Ditto for the most recent case of Research in Motion.","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"34 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80705651","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Index","authors":"","doi":"10.1002/9781119639695.index","DOIUrl":"https://doi.org/10.1002/9781119639695.index","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"45 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90483011","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Board Culture and Orientation","authors":"","doi":"10.1002/9781119639695.ch30","DOIUrl":"https://doi.org/10.1002/9781119639695.ch30","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"22 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81795689","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Investment Team Diligence","authors":"","doi":"10.1002/9781119639695.ch12","DOIUrl":"https://doi.org/10.1002/9781119639695.ch12","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"111 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87032675","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Art of Value Creation","authors":"","doi":"10.1002/9781119639695.part4","DOIUrl":"https://doi.org/10.1002/9781119639695.part4","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"52 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87630580","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Trandafir Raluca Andreea, Truicã Luiza Denisa, Spãtariu Elena Cerasela
{"title":"Performance Analysis","authors":"Trandafir Raluca Andreea, Truicã Luiza Denisa, Spãtariu Elena Cerasela","doi":"10.1142/9789814508179_0003","DOIUrl":"https://doi.org/10.1142/9789814508179_0003","url":null,"abstract":"The notion of performance has multiple meanings and sometimes it is paradoxical as each company must define performance for its internal and external communication. As we are trying to find a definition of performance based upon the features that a company should have, we find that every day companies invent new ways to compete in a competitive environment. One thing is certain: performance is achieved over time and can be seen. We will test the model on the analysis of credit risk indicators of multitude of existing indicators, we considered representative performance.","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"41 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90832229","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"LP Universe","authors":"","doi":"10.1002/9781119639695.ch8","DOIUrl":"https://doi.org/10.1002/9781119639695.ch8","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"5 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81431824","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Welcome to the Land of Ad‐Venture","authors":"","doi":"10.1002/9781119639695.ch4","DOIUrl":"https://doi.org/10.1002/9781119639695.ch4","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"43 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80186944","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Let Me Know How I Can Be Helpful: Value Creation","authors":"","doi":"10.1002/9781119639695.ch31","DOIUrl":"https://doi.org/10.1002/9781119639695.ch31","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"46 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74934443","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Business of Cash and Carry","authors":"","doi":"10.1002/9781119639695.ch1","DOIUrl":"https://doi.org/10.1002/9781119639695.ch1","url":null,"abstract":"","PeriodicalId":22469,"journal":{"name":"The Business of Venture Capital","volume":"55 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74895646","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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