Press Release Summary: Everybody is in search of booking profit or looking for short term returns but at the same time you should not forget that you are trying to catch the falling knife. If you make sure that you are picking value stocks then there is no need to fear in fear storm.
Press Release Body: Especially in bear market everyone fears and gets ready to sell their holdings but this is the time to average your stock if it is having growth potential and appropriate valuations. Currently valuation is temporarily ignored by the market. Fear is ruling in the market now days. Everybody is in search of booking profit or looking for short term returns but at the same time you should not forget that you are trying to catch the falling knife. If you make sure that you are picking value stocks then there is no need to fear in fear storm. In current scenario you will find lots of stocks whose PE and price to book value are below normal value.
What is PE and price to book value? Low PE ratio - PE ratio is one of the most important ratio on which most of the traders and investors keep watch. Important - The PE ratio tells you whether the stock's price is high or low relative to its earnings. The high P/E suggests that investors are expecting higher earnings growth in the future compared to companies with a lower P/E. but, the P/E ratio doesn\'t tell us the whole story of the company. It\'s more useful to compare the P/E ratios of one company to other companies in the same sector/industry and not in different sectors.
PE ratio of less then 10 is generally considered as undervalued provided it has future growth potential. And in some scenarios PE of 10 to 15 can also be considered provided the company has high growth performance in past and expecting same in future. Generally stocks bought below 10 and kept invested for long term given more great returns.
Low Price to Book Value (PB)- Basically PB ratio is mostly utilized by value investors to find real wealth when the stocks are at their lower prices. So investing in stocks having low PB ratio is to identify potential candidates for future growth. A lower P/B ratio could mean that the stock is undervalued. Book value - It is the total value of the company's assets that share holders would receive if a company closed down. Like the PE, the lower the PB, the better the value of the stock for future growth. Some of the investors become quite wealthy by holding stocks for the long term of such companies whose growth is based on their businesses instead of market and one day when every one notices this stock the value investor's pockets are full of Most of the analyst considers this ratio best to work under 1. If the stock's price to book value is below 1 then it is considered as undervalued.
So if you wish to invest such undervalued stocks then please visit at http://www.daytradingshares.com
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