1) Price-Earning ratio = share price / earnings per share (EPS) 2) Simple Definition: For one year of earnings, how many times is the market valuing it? 3) Generally higher ratio means investors are confident about the future prospects of the company and vice versa.  4) Another way to look at it is higher ratio means likely to be overvalued and lower value signals undervaluation. 5) Be wary of just using one year of earnings for cyclical company eg. Company who earns $1 every year for 9 years but at the end of the cycle earns $5.  PE ratio for a $10 company is 10 for every year and for the final year it is just 2.  SOLUTION: Take average EPS over the cycle period. 6) Historical PE = market price/trailing 12 months EPS (Good for gauging industry PE ratio) 7) Forward PE =

1) US stock market is the largest in the world and USD is the world's reserve currency and most widely used currency is the world.  These two reasons make listing in US one of top choices for a company if they want to list at a good a price because it the biggest stock market with the most volume of transactions and possibly most liquid.  Which is why Alibaba list in the US (besides HK).2) Delisting from the US stock market means possibility of being taken down in major US indices.  With many passive funds investing and tracking indices, if a company is being removed from its indices, the passive funds would have to sell the share to match the indices.  (Selling = increase in supply of shares = lower share price)3) Some investment vehicles have a mandate to invest

Jack C. BogleThe man who brought index funds to the world. The idea is simple:1) Investing costs (management fees or trading fees) reduces returns over the long run. A low cost index fund enables minimal costs incurred and hence maximises the chance of tracking market returns.2) Diversification reduces portfolio risk.3) Most funds and retail investors don’t beat the market in the long run (they might in the short run), the surer way (higher probability of success) of making money is to invest in a low cost index fund.How to earn money by buying an index fund?1) A long time frame is required, the idea is that given enough time (no matter great depression, financial bubbles and recession or even world wars), the market will always grow and push to a new peak. Of course one can argue the past

An extreme summarised version of the book in 10 points: 1) Most people should not attempt to invest in individual stocks. 2) 4 ways of dealing with cash on hand: put in bank, put in (nearly risk-free) government bonds, put in corporate bonds or invest in the stock market. 3) Whatever you do, as a rational investor, always invest at a rewards level higher than the risk-free rate.  If the risk-free is 5%, make sure your expected returns from investing is higher than 5% to compensate for higher risks. 4) Key idea of the book is to buy GOOD COMPANIES @ BARGAIN PRICES. 5) GOOD COMPANIES i.e. companies who has a good return on capital (ROC) = EBIT/(net working capital + net fixed asset).  The higher the ROC the better the company as it uses its capital more efficiently which implies a

No: 1) Nobody knows how China's regulatory clam down will continue and in what manner and extent. Recently, chinese regulators says self-inspection within Ant "almost done," but that issues remained to be investigated, without elaborating. This is as good as saying we might hit them further. Plus rumours of additional checks and recent clam down on Alibaba’s food delivery app Ele.me points to further pain going forward. 2) Don't downplay the effects of Jack Ma's comments and China's regulatory clam down in response as the end of story. Making a multi-billion company fail may be the message the authorities want to send out for would-be dissenters. Although I believe they are too big to fail, never say never….. 3) China's new data regulations may blunt Alibaba's data monopoly, and data is mo