Tag Archives: stock trading

William’s Tales – 2nd Anniversary with 100 Posts

I feel illimitable pleasure to share my glad tidings with members of my blog family. Today marks the 2nd Anniversary of “William’s Tales” with its score of 100    100th3 posts. Being it a self-propelled blog, I had to work hard, but with no any physical or mental fatigue even at this age of 68. In the length of this period, many friends and strangers have mobilized me and motivated my creative works. List of all those behind my blog is very long indeed, but lack of space forbids me to enumerate all.

With apology of many un-named supporters of mine in this Article, I would like to remember and thank some who have helped me during my 2nd year of blogging. They are: Read the rest of this entry »


Tags: , , , , , , , , , , , , , , ,

Whether PE ratio is enough to justify investment?

This precise Article on stock trading is the tri-sectional combination of my experience, acquired knowledge and Intuition. My Readers may be, possibly, more knowledgeable in stock trading rather than me. Even though I dare to put my ideas particularly on P/E ratio, relied upon the most by investors and analysts as one of the important factors to ascertain a quality stock. But, in my opinion, to emphasize this only tool is not wise for a better choice as it may prove to be imperfect just as in a folk story of “Blind men and an elephant”.

Price-Earnings (PE) Ratio is a primary indicator of how much a particular stock is cheap or expensive to deal in or compare with having similar price or sector. Its calculating formula is as PE=Market Price/EPS. In simple way, you may say how many times more the price you pay to earn INR 1 or a unit of any other currency. But, to rely upon P/E solely is risky. PE ratio only can never give you a clear picture of company’s performance. You should take into consideration some other profit indicators also while putting your money into a flaming (!) stock market.

Just to maintain spread of the topic, I’ll continue on the tool of PE only. Base figures of Market Price and EPS (Earning per Share) are authentic but not too effective in this calculation. Market price changes every minute, day or month. Similarly, figure of EPS also fails here as it may be of the previous year/quarter ending. Some analysts calculate average of past four quarters and in modified way past two and two future quarters with projected EPS. What it may be, but it is very clear that EPS figure is delusive and market price is always unsteady.

PE may be a good indicator to start searching a good company but not always a fool-proof tool. PE is the result of past figures and market price is variable aiming to future sometimes. Any company’s EPS may be poor, but its future growth may be bright and this factor may provide fuel to move its price to higher side. EPS of some companies may look lucrative like mirage in desert in case of their other income occurred due to the sale of the assets and they inflate their profit figures highly.

For most of the people, stock trading is their part time activity and it is not possible for them to investigate any stock in its depth. Studying fundamental and technical analysis is the job of the Analysts and Fund Managers. My aim of this brief Article is just to warn investors not to follow PE blindly. They should not overlook other factors such as stable growth, steady profits, regular dividend payments, ROE (Return on Equity), PEG (advanced to PE), Book Value etc. over and above EPS and/or PE.


– Valibhai Musa

Leave a comment

Posted by on December 20, 2008 in Article, MB


Tags: , , , ,

ગુજરાતી સાહિત્ય-કલાને સમર્પિત બ્લોગ

હાસ્ય દરબાર

ગુજરાતી બ્લોગ જગતમાં રોજ નવી જોક અને હાસ્યનું હુલ્લડ

ગુગમ - કોયડા કોર્નર

વિશ્વભરના ગુજરાતીઓને ચરણે- કોયડાઓ

Philosophy is all about being curious, asking basic questions. And it can be fun!


#gujarati #gujaratipoetry #gazals #gujaratisongs #gujarati stories #hindi poetry

ગુજરાતી રસધારા

રસધારા ગરવી ગુજરાતની, સુગંધ આપણી માતૃભાષાની ! © gopal khetani - 2016-21


અમેરિકામાં ધબકતું ગુજરાત

દાવડાનું આંગણું

ગુજરાતી ભાષાના સર્જકોના તેજસ્વી સર્જનોની અને વાચકોની પોતીકી સાઈટ

કાન્તિ ભટ્ટની કલમે

મહેન્દ્ર ઠાકરની અભિવ્યક્તિ

Tim Miller

Poetry, Religion, History and Art

Quill & Parchment

I Solemnly Swear I Am Up To No Good

Simerg - Insights from Around the World

With a focus on the artistic, intellectual and textual expressions of the Ismalis and other related Muslim traditions

The Blog

The latest news on and the WordPress community.


DoubleU = W



એક જ ‘ઈ’ અને ‘ઉ’માં ‘રૅશનલ વાચનયાત્રા’

eBayism School of Thought



The World's leading success industry


મારા વિચાર મારી કલમે

vijay joshi - word hunter

The Word Hunter -My English Haiku and Notes on my favourite Non-Fiction Books