some great comments by mungofitch on value…

A bond, a share of stock, a trust certificate, a promise from your brother-in-law.
What changes is the certainty, size, and timing of the current estimates of the ultimate payouts it can support. (and, as mentioned, the discount rate one might choose).
Depending on one’s assumptions about those, one’s actual value estimate will go up or down a bit.
But the range of results is not a way of saying that value is purely in the eye of the purchaser.
Rather, the range arises only a result of the degree of uncertainty in estimating the as-yet-unknown coupons.
They will eventually be known, and there will be a final one true number. That’s the value.
The limit of precision knowable today does not in any way suggest that the value doesn’t exist, just that (so far) it can only be estimated with error bars.
The market price might be wildly higher or lower than the value at any given time, and often is, but that doesn’t matter.
The security has demonstrable value even without a market, so there is no way that the market price can be the definition or determinant of its value.

perhaps part of the problem of calling a stock price “whatever someone is willing to pay for it” is semantics

google definition

the regard that something is held to deserve; the importance, worth, or usefulness of something.
“your support is of great value”
worth, usefulness, advantage, benefit, gain, profit, good, help, merit
Miriam Webster definition the monetary worth of something : market price??: relative worth, utility, or importance

note the word “worth” here?? If I were drowning a life preserver would have more “worth” than a million AAPL shares Since I am on dry land I would willingly swap one of my life preservers for the Apple stock.


I’d go out and buy a whole raft of life preservers and trade them for 1M AAPL each . . .