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Foreign exit continues

(From Reuters' report Wednesday)

Sri Lanka’s bourse is Asia's best performer so far in 2011 with an 8.6 percent gain, after a 96 percent rise last year.

But foreign investors have sold a net $55 million (Rs 6.1 billion) in 2011, after selling a record net $240 million (Rs 26.4 billion) in 2010.

Sri Lankan stocks are meanwhile amongst the world’s overpriced:

The bourse is trading at a forward price-to-earnings (P/E)ratio of 14.7, one of the highest among emerging markets, compared with 12.2 in Asian markets and 11.4 in global emerging markets.

P/E is the price of a share divided by its estimated future earnings.

See our earlier post:

‘Sri Lanka’s stocks: a closer look’ (Jan 2011)

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