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Up3
What does it mean by expected P/E 10 years prior?
Why is the repricing of P/E = 15 (expected P/E 10 years prior) on numerator? I would have thought the (current P/E) should be on the numerator?
A bit confused. Thanks.
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Up3
Price Changes = Ending Market Price / Beginning Market Price
Repricing changes = expected (future) P/E / Current
So 15 needs to be on the numerator.
If not mistaken P/E 10 years prior means Price divided by earnings of the past 10 years.
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Up2
Thanks @vincentt @beancounter I got confused with ’10 years prior’. All good now.
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Up2
@Alta – am not surprised. It was very strange terminology. That’s my biggest fear about the exam: that the words used to describe something in a question are different to what is in the books/they mean…
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Up0
You need to work out what it means in terms of annual changes in PE.
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