NSE vs NVE Which Outperforms?

When it comes to investing in stocks, there are two main categories to consider: NSE and NVE stocks. NSE stocks, or Non-Systematic Risk stocks, are affected by individual company-specific factors such as management changes, competition, and industry trends. On the other hand, NVE stocks, or Systematic Risk stocks, are influenced by broader economic factors like inflation, interest rates, and market volatility. Understanding the differences between NSE and NVE stocks can help investors make informed decisions and diversify their portfolios effectively.

NSE or NVE?

When comparing NSE and NVE, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between NSE and NVE.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. NSE has a dividend yield of 0.88%, while NVE has a dividend yield of 5.13%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. NSE reports a 5-year dividend growth of 0.00% year and a payout ratio of 14.12%. On the other hand, NVE reports a 5-year dividend growth of 0.00% year and a payout ratio of 119.93%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with NSE P/E ratio at 19.34 and NVE's P/E ratio at 23.39. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. NSE P/B ratio is 2.45 while NVE's P/B ratio is 5.81.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, NSE has seen a 5-year revenue growth of 0.14%, while NVE's is 0.28%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with NSE's ROE at 12.98% and NVE's ROE at 24.62%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are €28.10 for NSE and $77.00 for NVE. Over the past year, NSE's prices ranged from €19.40 to €31.00, with a yearly change of 59.79%. NVE's prices fluctuated between $69.86 and $90.24, with a yearly change of 29.17%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.