Still Have 40,000 Shares of IMMR

[DesertCat]

[ QUOTE ]
[ QUOTE ]
But catch these errors, you need to be able to estimate what intrinsic value is, and you can't do that by just looking at one aspect of the company.

[/ QUOTE ]

So according to this statement, you cannot make money with insider information about pending one time events (lawsuits, settlements, recalls, discoveries, etc.) which is equivalent to the realization of the market misinterpreting the effects of public one time events.

[/ QUOTE ]

Estimating intrinsic value has nothing to do with what kind of information you have, it's assumed you have enough information to estimate value reasonably accurate. This isn't always true, and some companies (internet businesses during the bubble) couldn't be estimated at all due to this information failure.

And as far as I can tell, David isn't talking about insider information.

[ QUOTE ]

Price is determined by the aggregate view of the market. If the public is irrationally viewing one factor, how is this any different from the public irrationally viewing the sum of all of the factors(ie the intrinsic value)? Both are going to put pressure on the price in one direction and both are making assumptions about how much attribution various aspects contributes to the price determined by the market.

[/ QUOTE ]

One more time, how can you tell whether the public is irrationally viewing any factor? And how can you tell whether any errors made by "the public" in one factor, isn't more than offset by errors the public made in all other factors?

There is only one reasonable approach (assuming you agree with David that you can't predict price action through charting and other technical approaches). You estimate all the factors and compare the sum you get to the market price. Usually price will be close to your estimate. When the price is far below a reasonable estimate, you have enough "margin of safety" to make a purchase.