Peter Lynch's legendary fund manager, who made more than 30% to its fund in 1980. Key to success in equity trading is to buy ones that have the potential for growth at a fair price.
Right now we can not find something. A look at the S & P500 shows that P / E ratio of companies in the index is currently 1.7 times higher than the rate at which analysts expect earnings to grow in the next five years. This difference is known to some as PEG Rati is the largest since 1995. since.
Analysts lowered their forecasts for earnings growth of companies in the S & P 500 with the fastest pace of the last 6 years, anticipating that profits will increase by 1.4% in 2015. This is lower than 15% raised growth annually by 2009. until now.
Machine profits, which fed the bull market for 2275 days already slowing acceleration of the decline in US GDP in the first quarter and earnings of corporations recorded a decrease as a result of the strong dollar.
This is not good news for investors currently in stock prices at record high levels. About 17 times P / E index was 15% above forecasts for returns for the last 2 decades
"You could say the last few years have seen a rise in stock prices far above the real growth of the companies." - Sam Stewart as president of Wasatch Advisors Inc.
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