While calculating PE ratio of a mutual fund what do I do with negative earnings of a particular stock?

Question

I am reading one of Peter Lynch's book and he recommends some decisions based on the PE of a mutual fund. While trying to calculate the PE of the mutual fund, I came across a member stock with the negative earnings. How do I go about weighting this stock's PE in the total PE of a fund?

Orange Coast- reinstate Monica · Accepted Answer

Index publishers such as S&P do indeed subtract losses from the aggregate earnings of the index. Prof. Jeremy Siegel complained years ago in the WSJ that this practice understates the earning power of the aggregate index in bad years.

Correct answer by Orange Coast- reinstate Monica on May 28, 2021

While calculating PE ratio of a mutual fund what do I do with negative earnings of a particular stock?

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