Foreigners appetite for risk is way different to a South African's. We work on PE's of 20 being expensive, but that is because our risk free rate (R157) usually sits around 7%-10%, so when you discount a stock relative to the risk free rate, in classic DCF models, you are going to want the earnings yield to sit within range of this rate. The higher the risk free rate, the lower the PE (please note this is just my theory, there is no impirical evidence to support this). now foreigners work on risk free rates of like 2% or 3% (and this is really falling), so they will have a much healthier appetite for higher PE's, especially if a stock's dividend yield is already greater that the rate at which they can borrow. Their only real risk is rand devaluation, but if they invest in South African stocks that benefit from a rand devaluation, then they will offest their risk. Naspers, Shoprite, Steinhoff, resources, SAB, Sasol - to name a few. now this is just my theory