Taken together, those two things mean that concerted short selling certainly can, in theory, drive a company's stock price well below fundamental value, and keep it there for some period of time.
Value funds, which focus on stocks selling below their fundamental value, surged 18.3percentt in the second quarter, on average, after losing 36.2percentt in 2008.
The low-volatility strategy also shares plenty of DNA with value investing, which focuses on stocks trading at a price deemed below their fundamental value.
The customary joint communique at the end of the meeting will be scrutinized for semantics, especially any official endorsement of the idea that the euro has fallen below its fundamental value.
In America, for instance, mortgage-backed securities have fallen far below their fundamental value in thinly traded markets, partly because the people who would benefit most from buying them have no mechanism to do so.
They think central banks should become "market-makers of last resort", setting a price for securities that can no longer be sold on "orderly" markets because distress sales are pushing prices far below their fundamental value.The central bank could make a market in CDOs, say, either by accepting them as collateral or by buying them outright.
Better-capitalized institutions also are less likely to take actions that lead to broader financial-sector distress and its associated macroeconomic costs, such as large-scale sales of assets at prices below their fundamental value and sharp contractions in credit supply.
In this situation, though, Samsung C&T has been trading well below its fundamental value on the stock market, allowing Cheil to purchase it using the formula at a large discount.
America's fundamental values are threatened.
It would be to lose fundamental values.
