Valuation method of stock fund
Mainly focus on two important indicators:
1. P/E ratio = current share price/earnings per share.
Simply put, it is how much consideration the market is willing to pay for each dollar of income of a company at present.
P/B ratio: P/B ratio = current share price/net assets per share.
The focus of price-to-book ratio is the fixed assets of enterprises.
The valuation of large industrial preparation enterprises and cyclical industries mainly depends on the price-to-book ratio.
There are many fixed assets in its asset composition, such as steel, coal and other non-ferrous metals. Large industrial preparation enterprises also belong to cyclical industries, and their net profit changes greatly in different periods. Simply using P/E ratio may not show whether they are overvalued or undervalued, so it is very necessary to assist the index of P/B ratio.
In addition, if an enterprise has a large number of assets, even if it does not operate, the assets can often be sold. Therefore, if the P/B ratio is less than 1, that is to say, the stock price is less than the net assets per share, then the stock price is safe.
For example, a reasonable P/E ratio is 20, which means that under normal circumstances, the market is willing to pay 20 yuan's consideration for its annual income of 1 yuan.
Two, stock funds are divided into two categories.
There are two kinds of stock funds, one is active management fund and the other is index fund. Index funds are divided into passive and enhanced types. For actively managed funds, their investment scope is very large, and the positions invested by funds may change with the ups and downs of the market at any time. However, the fund only publishes its top ten awkward stocks every quarter, so it is impossible to judge the valuation of actively managed funds. Compared with active management funds with no scope restrictions and fixed positions, index funds track an index, and the short-term rise and fall will basically follow the rise and fall of the index, so the valuation of index funds can be judged by the index they track. When we look at the percentile data of index PE, many people think that when the percentile is less than 20%, it means that it is undervalued less than 80% in history, and when the percentile is higher than 80%, it means overvalued. However, it will take time to prove whether it is reasonable to overestimate and underestimate the percentile, because the 20% percentile and the 80% percentile will change with time.