This is the concept I have termed which trying to grasp. A number of us understand not to fall into the trap of price anchoring. What this mean is that there is a believe of specific price of a stock that one is familiar without consideration of fundamental or market changes.
This often happens when one buy a stock and will not sell even when fundamental has weakened and continues to assume the price will return to purchase price or higher.
Yield Anchoring is more for dividend investor. Say we use to buy CMT at 5.8% yield. Today the stock price is trading at 4.8% yield, one may view as too expensive. Should we sell CMT ? Can we buy CMT ?
If I am to go through logical thought process. Few things come into my mind.
1. Business Fundamental
Can DPU maintains? Can it grow?
2. Alternative investment
Alternative investment that gives