Money: a simple word that, if you aren’t careful, can cause you a lot of problems. If not you, then maybe for a family member or a close friend.
Just like a professional golfer utilizes various clubs based on the situation, I too have valuation metrics for different situations.
One of the easiest and simplest metrics that investors use to screen for, as well as value, stocks is the price-to-earnings ratio, better known as a stock’s P/E.
The problem with higher prices is that past a certain point, it becomes difficult to pass along higher costs to consumers.
If you had never looked at a chart of any of the major stock market indices before and you saw one from last week, you would likely say, “What happened?”
If you’ve been a longtime investor or even if you’re just a novice, you and I have many things in common, including wanting to generate profits.