Critics of the value approach to stock investment argue that listed common stocks cannot properly be regarded or appraised in the same way as an interest in a similar private enterprise, because the presence of an organized security market “injects into equity ownership the new and extremely important attribute of liquidity.”
But what this liquidity really means is,
- first, that the investor has the benefit of the stock market’s daily and changing appraisal of his holdings, for whatever that appraisal may be worth, and,
- second, that the investor is able to increase or decrease his investment at the market’s daily figure—if he chooses.
But it does not impose the current quotation on an investor who prefers to take his idea of value from some other source.