Tag Archives | valuations

U.S Stock Market Valuations continue to warn

We have updated the RecessionALERT Valuation Index (RAVI) forecast models for the SP500 using 4Q2018 data. Stock market valuations continue to pose a “clear and present danger” to positive economic and SP500 returns outcomes, and have worsened since our last warning . One and two year SP500 forecasts continue to offer relatively accurate short-run estimates […]

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Stocks valuations pose “clear & present” danger.

Those clients who have been with us since 2010 will know our refrain from issuing unnecessary and/or sensationalist warnings about the economy and markets. In fact, in 2012, the general consensus was that the US economy was about to fall back into recession, a view we opposed to quite some ridicule from certain quarters. Whilst […]

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RecessionALERT Valuation Index (RAVI)

PART-1 There are currently 4 mainstream models used to forecast 10-year total returns on the SP-500 (dividends re-invested) The Shiller CAPE ratio (PE10) The Warren Buffet Indicator Tobin’s Q-Ratio Average Investor allocation to stocks The non-linear quarterly correlations between these four models (x-axes) and achieved 10-year future total returns (y-axes) on the SP-500 since 1970 are […]

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Valuations not at nose-bleed levels yet

The recent run in the major U.S stock indices has resulted in Shiller-PE charts being trotted out showing how far we are off the historical mean, implying a nasty pullback is in the works. The problem with a historical mean is that it is a single horizontal value on a chart that fails to take […]

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