Learning Insights
@Course TA Cici
This is a good course especially for beginners as there are way too many stocks available for selection and likely will find it difficult to choose. The various steps enables user to learn about the types of company to invest during the selection process.
Day 1: growth or mature company. (Are we in for short term profit or long term)
Day 2: nature of business and ROE (return on equity - measure of the profitability of a business in relation to the equity)
Day 3: learn about PB and PE of a company.
(i) PE (Price to earnings ratio):
The price to earnings ratio (PE Ratio) is the measure of the share price relative to the annual net income earned by the firm per share.
A higher PE suggests high expectations for future growth, perhaps because the company is small or is an a rapidly expanding market.
(ii) PB (Price to book ratio):
The PB ratio measures the market's valuation of a company relative to its book value. P/B ratio is used by value investors to identify potential investments. P/B ratios under 1 are typically considered solid investments.
Day 4: Choose an index and learn about 5day and 120 day moving average. It taught us to look at
Moving averages, which is often viewed as an easy way to place transactions since they correspond to the average price that all traders have paid over a given time frame. It can give traders a sense of whether the trend is bullish or bearish.
All these are useful for beginners and seasoned traders alike. Sometimes human beings may get influenced by other people, greed, anxiety and get pushed to buy certain stocks for fear of missing out. It is crucial to always be cool headed while trading and not be affected by emotions. And as always, do your own diligence, because nobody cares about your money more than you do. Investors should consider multiple valuation techniques to value a company.
This is a good course especially for beginners as there are way too many stocks available for selection and likely will find it difficult to choose. The various steps enables user to learn about the types of company to invest during the selection process.
Day 1: growth or mature company. (Are we in for short term profit or long term)
Day 2: nature of business and ROE (return on equity - measure of the profitability of a business in relation to the equity)
Day 3: learn about PB and PE of a company.
(i) PE (Price to earnings ratio):
The price to earnings ratio (PE Ratio) is the measure of the share price relative to the annual net income earned by the firm per share.
A higher PE suggests high expectations for future growth, perhaps because the company is small or is an a rapidly expanding market.
(ii) PB (Price to book ratio):
The PB ratio measures the market's valuation of a company relative to its book value. P/B ratio is used by value investors to identify potential investments. P/B ratios under 1 are typically considered solid investments.
Day 4: Choose an index and learn about 5day and 120 day moving average. It taught us to look at
Moving averages, which is often viewed as an easy way to place transactions since they correspond to the average price that all traders have paid over a given time frame. It can give traders a sense of whether the trend is bullish or bearish.
All these are useful for beginners and seasoned traders alike. Sometimes human beings may get influenced by other people, greed, anxiety and get pushed to buy certain stocks for fear of missing out. It is crucial to always be cool headed while trading and not be affected by emotions. And as always, do your own diligence, because nobody cares about your money more than you do. Investors should consider multiple valuation techniques to value a company.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Invest With Cici : Your summary looks even better than mine
Really great work!!!
Milk The Cow : I think estimate pe ratio is lower= higher growth expectation, I think... from what I study.
Something call "PE compression" over years.