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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era

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To: Axel Gunderson who wrote (733)9/2/1998 4:56:00 PM
From: porcupine --''''>  Read Replies (1) of 1722
 
in 1972, what were the anticipated growth rates for earnings of the Nifty 50?

To the extent that p/e's are an implicit earnings forecast, the p/e on the Nifty 50 at their peak in December 1972 was 41.9. For the S&P 500 it was 18.9.

Nearly 25 years later, in June 1997 (which doesn't include the most recent runup), the Nifty 50's annualized return was 12.7%, vs. 12.9% on the S&P. The annualized earnings growth for the Nifty 50 was 11.0%. For the S&P it was 8.0%.

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