What is P/E ratio ?

In this digital era people are shifting more from traditional way of living to a digital way of living. No doubt, people are choosing way easier task to do for a living. Apart from a regular job, people are also involved in different works too. Because, traditional way of income somehow fails to fulfill all the dreams that one have assumed to. 

It's clearly visible that since one or two decades people are turning to an investor. They like to invest in many such companies whose are great enough to earn for them or some failed. No Matter investing are trading both may sounds similar,but there consequences are different from each other. We will discuss about that some other time.

Are you an Investor ? If yes, do you follow the rule or your heart ? Well, that's also a matter of discussion whether one should follow the rules or his/her heart ? But, certain parameters may show you where you are putting your hard earned money . Are they worth it or not . 

So, we are going to discuss about P/E ratio. Which may you have heard before or you may have used it before. But, let others know about it. What actually it is and how it works.

What is P/E ratio -

Well if are don't know what P/E ratio is called, let me tell you it's know as Price-Earning ratio. It reveals companies share price to it earning per share.

You must be aware about how a company's share giving you in return. P/E ration vary from industry to industry. So you need to grab much know in that industry you are putting your hard earned money.

Formula - P/E ratio = Share Price/ Earning per Share

*Hope you now have a basic knowledge about P/E ratio , later we will discuss about how it works, why we need it and other parameters to know before buying a stock