Understanding the basics

From my reading of The Intelligent Investor, one interesting indicator for security analysis is the price per earnings ratio (P/E), which to my preliminary understanding is the price per share divided by the net income of the company per share. I went to check up on the statistics of my recently acquired iShares China ETF and found out that the average P/E ratio for the basket of holdings is 13.71, suggesting to me that in about 14 years time, if all things go as well as now, the companies which I bought into would have earned back the money per share that I paid for.

I am not sure if this means the ETF is overvalued or undervalued, and in any case the lesson learned here is that I should probably research into the shares before I make any attempt to purchase them, which I did not do for this time. Another observation is that the annual management fee is 0.74%; regardless of the returns, I should be prepared to lose this percentage every year. Looks like making investments is a far more arduous and complicated journey than I originally thought. I should probably gain more knowledge before committing my next buy.