The Study on the interaction of Price-Earnings Ratio and Price-Book Ratio on High Return on equity

• Main Authors: Wen-Chun Huang, 黃文駿
• Other Authors: Chin-Chuan Huang
• Format: Others
• Language: zh-TW
• Published: 2015
• Online Access: http://ndltd.ncl.edu.tw/handle/73108775737219727564

碩士 === 銘傳大學 === 資訊管理學系碩士在職專班 === 103 === At a time that living expense increases rapidly and that the deposit rate is always lower than inflation, how to increase personal equity assets become first priority for personal finance management. Under this condition, investment stock appears to be a better option as it tends to have higher profit and payoff. The purpose of this study is to selection the best stock combination of Listed Companies and Over the Counter in Taiwan. First, only the stocks have a ROE over 15% in the past three years were retained for analysis. Second, two criteria were use to identify the possible combinations: stocks the high profitability or stocks with better Return On Investment groups on the interaction of Price-Earnings Ratio and Price-Book Ratio on High Return on equity. Third, based on select better Return On Investment at ROE''s increased or decreased between two years. The results show that (1)The selection based on ROE over 15% in three years yielded better ROI more better than TAIEX and this selection method is simple and intuitive to general investors. (2)Adding on two additional selection criteria, Price-Earnings Ratio and Price-Book Ratio, can further improved the ROI of the stock combination. Specifically, the combination that includes The Listed Companies with high-growth P/B Ratio and high-growth P/E Ratio yields better profit than TAIEX. (3)At ROE''s interaction of increased or decreased in 3 years, that stocks of Listed Companies and OTC Companies that have rising trend of ROE yield better profit than other combinations and TAIEX. The companies are in-Growth Companies. It''s a good way for all stock investors, that study the stocks have a ROE over 15% in the past three years and ROI after one year.