We have lots of experienced traders on MoneyAM who would be glad to help if you have any trading questions.

Ricardo
Consider opening a CFD account it can be much less expensive as there is no stamp duty.
D.

Morning all, very basic question for the likes of you guys. p/e ratio means exactly what? many thanks!!

Price to earnings ratio

thanks LW. sorry for sounding really thick but how is that calculated.

Sorry - forgot to actual post something!

It'll take me a while to remind my self the exact, but off the top my head its something like the share price times the number of shares in issue divided by the annual turnover

But I'm wrong, and someone beats me to the correct answer please feel free.

I think the important thing to remember with p/e's is to avoid companies with excessively high ones. A company with a high p/e must have incredibubble growth to justify it's high price - so a good starting point can be to benchmark it against it's competitors in the same sector.

Velocity - I'm surprised by what you say - as I was always told the opposite! Avoid companies with very low ones! Admittedly with companies with excessively high ones, I would take a second look to make sure that it is not just a temporary thing (It can be high just because they sold part of the company, which would have inflated earnings for that year only).

P/E ratio is calculated by dividing the share price by the earnings per share, where the earnings per share is calculated by dividing the profit by the number of shares in issue.

So in long form, the P/E ratio is the share price multiplied by the number of shares issued divided by the annual profit

I started by saying ----keep things simple
On reflection--after reading the posts -- I suggest you keep things simple
AFTER you have reached the stage of knowing above.

little woman - I did a bit of research into it, admittedly a few years ago, but the result was very marked. I looked over a timescale of years at companies with very high p/e's, and companies with very low p/e's - ie the extremes of both. I found that in the case of high p/e's the companies share price consistently underperformed those of the low p/e's for the following number of X years. All I know is that the factual evidence showed that the low p/e stocks racked up superior % share price growth vs their higher priced peers. Saying that, I would be quite happy to be proved wrong & I'm sure there are far better skilled fundamentalists out there than me.

cheers everone, it is all so clear now. happy trading all.

Is there an equivalent of the TICK & TRIN for the fTSE?

chadbukl

If you look at 'chart school' - personally I find this site really useful

http://stockcharts.com/education

and specifically:
http://stockcharts.com/education/IndicatorAnalysis/indic_TRIN.html
http://stockcharts.com/education/Glossary/TICK.html

you can find exactly how these indicators are calculated and this can be done for any instrument.

thxs

Thank for that link Jon
Also chadbukl have a look at http://www.snappytrader.com/info/info.htm

Can anybody help me with this one. How do you post a live link on here???, eg, if I wanted to post an article from another board , well on other sites you just make sure that you have the HTTP// in front of the address and then you copy and paste, but on this board it comes out dead.

Its easy with charts you just use the and the chart is transfered but I dont know how to transfer addresses over. Any help please.

cheers GF.

Resistant Levels. How do calculate them.
Thanks in advance.

Goldfinger

- go to the todays traders thread and on the bottom of the main bit, above the first post is a HTML Editor - click on that and details of how to use it are on the bottom. Once finished - just cut & paste to this site!

Washlander

- go to the todays traders thread and on the bottom of the main bit, above the first post is a pivot calc. You can use this try and calulate Resistance levels.

Thanks will do

Hi everyone - wonder if anyone can help with a spreadbetting question and how to set a stop loss.

If I buy at 1 and want to take a profit at 1.10 I think I set a limit order at that amount and if I want to limit my losses, I think I would set a Stop at say 90p.

What I don't understand is if I am betting on a price dropping, I have already sold the shares, so what do I use to take a profit and, more importantly, how do I stop my losses. I think I would need to use the limit & stop orders the other way round but am a little confused???

Great thread, especilly for me as I am really new to this arena and learning quickly by reading threads like this one.

Thanks in advance.

Mark.