Equity Derivatives Trading
|
||
|
Source : http://www.livemint.com
Activity:
2 comments
318 views
last activity : 07 06 2010 20:18:04 +0000
|
||
|
|
The Sensex PB ratio is now at a record high of 6.5, making the Indian benchmark the most richly valued among the global indices on this valuation parameter. The PB ratio is a measure of the value that the stock market is willing to assign to a company, based on the tangible assets on its books.
It is computed by dividing the market price by the book value per share. The PB ratio is the most widely used measure, after the PE multiple, to value stocks.
While the Sensex PB ratio rules at 6.5, data published in Forbes.com in mid-November, reveals that the developed markets in US and Europe trade at PB ratios of between 2.4 and 2.8.
Emerging markets such as Brazil (4.3) and Mexico (3.5) sport PB ratios that are a tad higher than developed markets, but they are still well below Indian levels.
Even the Shanghai Composite Index hovers pretty close to the Sensex, if you go by its PB ratio.The highest valuation among emerging markets is for Morocco, which shows a one-year forward multiple of 30.11.
Among the developed markets, Slovenia, at a multiple of 31.79, stands out in solitary splendour.
Of course, the high valuation is also a reflection of a high return on equity (RoE). India’s RoE is 19.77, according to the S&P/Citigroup numbers, well above China’s 15.31. But then, several other countries, including South Africa and the UK, have higher RoEs but much lower valuations.
Is the case against India on the ground of high valuations an open and shut one? Not really. If you took the valuation ratios as on 31 January 2007, India’s one-year forward PE, at 20.07, was higher than all other markets except for Morocco among emerging markets and except Slovenia and Luxembourg, among developed markets.
Yet that didn’t stop the Indian market from giving one of the highest returns among all markets last year. In local currency terms, the S&P/Citigroup index for India delivered a 59.4% return in 2007, much higher than the supposedly “cheaper” markets.
|
|
We all know that India has too many people and this is bad for our economic well-being . Mention... |
|
|
608 referals
25 arguments,
4937 views
|
|
|
The rural economy of India comprises of around USD 0.5 trillion. 54%t of MNC products and 59% of... |
|
|
81 referals
12 arguments,
993 views
|
|
|
Fundamental Analysis vs Technical Analysis |
|
|
346 referals
13 arguments,
461 views
|
|
|
|
|
|
|
|
|
Online DOCTOR- Informative too.... This site is very informative, which ever diseases you... |
|
|
103 referals
10 comments,
237 views
|
|
|
|
Accounting of revenues costs in Entertainment Ind. 13 May 2010 2,927 views No Comment A common... |
|
|
0 referals
1 comments,
286 views
|
|
|
I did my Schooling from a Boarding(St.Amtul's Public School - Nainital) Masters in International... |
|
|
968 referals
2 comments,
88 views
|
|
|
|
|
If punishment would have been the only remedy,countries like Iran and Saudi Arabia would have been crime free long back.Solution remains in eradicating crime by its roots.Even Today Mahatma Gandhi is remembered more than any extremist today...Killing... |
Yes this is the right time to buy the stocks as all the prices of these stocks are at an all time low and it will be a very good investment for the future, as when the market becomes stable then all these stock prices will surely rise and one can't... |
Inflation and deflation both are happening nowadays. Will negative inflation beep into deflation? |