Ignorance is bliss
While DCF can be performed on all companies, the result the technique spews out may not be reliable in a lot of cases. So, what is the solution? Simple, ignore such companies! Don't trust us? Let us see what Buffett has to say on the problem.
He says, "What counts for most people in investing is not how much they know, but rather how realistically they define what they don't know. An investor needs to do very few things right as long as he or she avoids big mistakes."
Image: Indian investors watch a ticker on the facade of the Bombay Stock Exchange showing the Sensex in Mumbai. | Photograph: Indranil Mukherjee/AFP/Getty Images
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