Building an investment portfolio of stocks valued at less or more than their real value in the stock market-an applied study in a sample of Iraqi banks

Abstract

This study aims to shed light on the importance of common stock valuation tools and models in decisions related to financing and investment, by using a sample of Iraqi banks listed in the financial markets during the period from 2013 to 2022. The study deals with the valuation of common stocks and determining whether they are valued at less or more than their real value in the stock market, using advanced financial models and the portfolio method. By analyzing a sample of ten local banks operating in various sectors, the hypothesis was that investing in stocks that are under or overvalued can lead to higher returns in the long term compared to investing in stocks that are traded at their actual market value. Quantitative analysis was used to prove this. Stocks were evaluated based on their market value and their real value, focusing on