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On China's Stock Market Price-earnings Ratio

Posted on:2004-08-15Degree:MasterType:Thesis
Country:ChinaCandidate:W H YuFull Text:PDF
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P/E ratio is a very important criteria to judge whether the stock market cangrow continuously healthily, and whether the market has bubble. The high p/e ratio indicates that the stock price and real value break away from excessively, certain bubble exists on the stock market, at the same time the market has unrealistic expectation to the growth of the stock future profits; low stock of p/e ratio might not be investor first-selection either, low p/e ratio demonstrates that investors have low expectation for the company's future growth, and the growth prospect of the listed company is not good. In China, because the lasting growth of the macro-economy and growth of company's achievement are out of step, the system on the stock market is not rational and perfect enough, administration structure of the listed company and stock right structure are not perfect enough either, there are a lot abnormal investment behavior on stock market, there is strong speculation atmosphere on the stock market, stock market need satisfy require of reform, government intervenes stock market, investment canal is less, the scale of stock market is small, these factors make the p/e ratio index on the stock market of our country on the high side. The high p/e ratio has confused the financial order, has strengthened financial risks, hinder the growth of the real economy, not benefit the forming of correct investment concept, encourage behavior of speculating, cause inefficient distribution full play of function. We can reduce the high p/e ratio, suppress the p/e ratio to increase, by improving the management level, perfecting stock right structure and administration structure of the listed company, strengthening supervision of the listed company, stopping up all sorts of abnormal behavior of the stock market, perfecting the stock market system, trying one's best to reduce the government's intervention, changing means of the government interfere etc. Then the china stock market can get lasting, healthy development.
Keywords/Search Tags:P/E ratio, stock market, listed company
PDF Full Text Request
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