CFA Practice Question

There are 191 practice questions for this study session.

CFA Practice Question

Which of the following variables is most closely watched by investors?

A. Dividend valuation stock price
B. Earnings valuation stock price
C. P/E ratio
D. Book value
E. Asset value
Correct Answer: C

While all the variables are important, the P/E ratio is probably the most widely watched by all investors; it is easily found in newspapers. The other variables are more specific in use.

User Contributed Comments 6

User Comment
Creep What relevance does this have?!
johntan1979 I'm pretty sure you won't ask what relevance does this have during the actual exam.
farhan92 if an earnings report comes out websites are more likely to provide a P/E figure than the rest.
ascruggs92 Creep are you serious or just trolling everyone?
khalifa92 P/E ratio is mostly cited by media and analysts.
MathLoser Keep in mind that P/E stands alone mean nothing. You have to compare it with the industry's P/E and the rival companies'.
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