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Strategies & Market Trends : Tech Stock Options
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To: Herring who wrote (53784)9/24/1998 10:06:00 PM
From: donald sew  Read Replies (2) of 58727
 
Herring,

>>>>>>>> Reasonable P/E is difficult to determine since P/E is current but stockprice is really a function of expected long term future earnings. When times are good people expect long term earnings to be good and P/E will be high. 5 year P/E would be a better measurement. P/E is really a measure of market psychology and not necessarily
earnings only. <<<<<<<<<<

You explanation is very good and I agree. I guess my comment is more towards those who do not understand it that well and the influence of analysts and others to basicly make blanket statements without a good explanation as yours. I have heard it over and over from less experienced investors saying that basicly their broker just say the P/E's are not important. And I remember when I just started investing that being said to me by many brokers without an explanation in regards to risk.

that really was a good a precise explanation.

Seeya
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