Two things I didn’t touch on Gengen's…
1. The appearance of excitement or over valued shares… look at the BRIC countries (Brazil, Russia, India and China) they are generally cooling off higher than where they started- Nigeria etc are actually globally doing better. The BRIC are Emerging Markets while we are Frontier Markets…but we are doing better and I expect us to follow the same general patterns. While the
NSE will eventually cool off. How soon will depend on how the political situation develops- if rule of law and the general invest environment becomes stable/better thank today, it will take 3 years, if status quo 2 yrs and if worst 1 year (my thinking here…).
2. On the PE ratio- look at the technical definition of PE and then localize it to the
NSE… i.e. compare a particular company to the average PE in its sector on the
NSE…and the Niger-guesstimate the rest!!! Check the IBTC stock select, their chart gives this information.
Lastly, do not rely too much on western trends…unfortunately, here we don’t have too much historical qualitative and quantitative information / data / research / analysis on the
NSE to go by… in a way, we are doing a small percentage of that here…
What do you think?