How do I determine whether nifty is underpriced or overpriced?

Question

How do I determine whether nifty is underpriced or overpriced?

Answer 1

Nifty is under priced now. Though it is expected to go down further you can buy the shares to motivate sellers to stop the selling trend. Many good shares are priced lower.

Answer 2

There are various methods and techniques with which you can determine the present status of the nifty with regard to it being over-valued or under-valued.

But to cut to the chase, look at it this way.  You have a 52 week high/low and you also have the 52 week average.  Now when the nifty is close to,at or above the the 52 week high it may be considered to be over-valued.  Conversely, when it is close to, at or below its 52 week low it may be considered to be under-valued.  It would be an opportunity to sell stock positions in the former and an opportunity to buy in the latter.

However, if you are looking for valuation models; we would recommend "Security Analysis" by Graham & Dodd and "Investment Analysis and Portfolio Management" by Prasanna Chandra.  For a more comprehensive list of reading on this matter of under and over valuation we would suggest that you do a search at amazon.com to find relevant reading material.

Akash

http://www.narachinvestment.com

Answer 3

.,.,.,.,.,.,.,.

http://www.flixya.com/user/GOLDCash360

.,.,.,.,.,.,.,.,

Answer 4

Currently it is said to be under priced as per P/E ratio. But since the market sentiments are bad it may have further down fall.