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    Motivated Sellers

    The idea is described in book Value Investing on page 234.

    A motivated seller, someone who, as Klarman puts, is selling for a noneconomic reason.

    Examples:

    • Spin-off
    • A stock is removed from an index

    Spin-offs🔗

    A stock is removed from an index🔗

    If a stock gets removed from an index a lot of institutional investors (passive index investors) would sell it regardless fundamentals.

    This would likely result into a stock being oversold and gives a bargain opportunity. )

    Panic selling🔗

    TODO: describe coronovirus panic selling:

    • Example with Netflix
    • Small caps fall deep because of lack of liquidity - what creates great opportunities