Patterns of Price/Earnings Ratios among Sectors and Company Sizes

I recently came across an interesting fact in Value Investing: from Graham to Buffett and Beyond about the relationship between the price to earnings ratios (P/E) of small cap companies and the market. According to the authors of the book, “[G]enerally the small caps P/Es are higher, befitting their more realistic prospects for growth. In 1983, . … Read more

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