Stock Market Myths

Stock Market Myths 1. You can tell if a Stock is cheap or expensive by the Price to Earnings Ratio. False: PE ratios are easy to calculate, that is why they are listed in newspapers etc. But you cannot compare PE's on companies from different industries, as the variables those companies and industries have are different. Even comparing within an industry, PE's don't tell you about many financial fundamentals and nothing about a stock's value. 2. To make Money in the Stock Market, you must assume High Risks. False: Tips to Lower your Risk: