O'Reilly logo

Cotter On Investing: Taking the bull out of the markets: practical advice and tips from an experienced investor by John Cotter

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter 4: The Mighty PEG

There are many methods you can use to pick a share, and everyone will have their own preferences. Some will seek out high dividends, some will follow the news, others read up on the broker’s recommendations and many study the charts (mostly price, not astrological!). While all of these and other selection techniques have merit, when it comes to stock selection I believe the PEG is the king!

What is the PEG?

In the previous chapter we looked at the PE ratio. We saw that while it was a useful measure, it does have limitations. For example, if company A has a PE of 12x and company B has a PE of 10x, then we can say that company A is more expensive (or has a higher rating) than company B. But that is all. The PE cannot ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required