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1492 terms

Glossary

Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.

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De-rating

Fundamental analysis
Also called: Multiple compression, Multiple de-rating

A fall in the multiple the market will pay for a rupee of a company’s earnings, usually because expected growth or the expected duration of that growth has been revised down.

In plain terms

Price is earnings multiplied by the multiple, so the two compound. Earnings up 12% with the multiple halved is a 44% fall, in a year when nothing went wrong.

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Indian stock market glossary · Market Vidyalaya