Question 4—Price and Value
Answer 4 Selection “Price equals value at any given moment” is incorrect.
Prices are easily seen while you need to look for values. Prices can change quickly in response to the mood of the masses, while values change slowly. Each price is a momentary consensus of value, but that consensus keeps changing, overshooting value on the way up or down. A simple tool, such as a pair of moving averages, helps you get a general idea of where the value is and which way it is moving—and allows you to trade accordingly.
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