Sentences with phrase «at extreme valuations»

If some of your holdings are currently trading at extreme valuations, I believe it would be wise to evaluate the risks associated with holding on.

Not exact matches

Yet the fact that these 13 years have included three successive approaches (2000, 2007, and today) to valuation peaks - at the very extremes of historical experience - is evidence that investors don't appreciate the link between valuation and subsequent returns.

The problem is that with valuations now at obscene heights, future returns are likely to be dismal, and future downside risks are likely to be extreme.

With the S&P 500 within about 8 % of its highest level in history, with historically reliable valuation measures at obscene levels, implying near - zero 10 - 12 year S&P 500 nominal total returns; with an extended period of extreme overvalued, overbought, overbullish conditions replaced by deterioration in market internals that signal a clear shift toward risk - aversion among investors; with credit spreads on low - grade debt blowing out to multi-year highs; and with leading economic measures deteriorating rapidly, we continue to classify market conditions within the most hostile return / risk profile we identify — a classification that has been observed in only about 9 % of history.

Second, if one wishes to argue that today's low interest rates will «justify» permanently extreme valuations even 10 - 12 years from today, it's useful to remember that if interest rates are low because the growth rate of cash flows is also low, then no valuation premium is «justified» at all.

But in the unlikely case that investors are willing to send this market into a renewed bubble in the face of extreme valuations, the S&P would only have to advance another 4 % or so on a weekly closing basis to induce us to participate at least moderately.

At present, the valuation measures that we find best correlated with actual subsequent S&P 500 total returns are at the most offensive levels in history, matching or eclipsing the 1929 and 2000 extremeAt present, the valuation measures that we find best correlated with actual subsequent S&P 500 total returns are at the most offensive levels in history, matching or eclipsing the 1929 and 2000 extremeat the most offensive levels in history, matching or eclipsing the 1929 and 2000 extremes.

And when valuations are at extremes, as we believe bonds are today, historical price volatility might not shed much light on future risk.

But with long - term bonds and non-cyclical equity sectors trading at historically extreme valuations while cyclical sectors trade at valuations below their long - term average, we think that risk aversion is creating numerous investment opportunities for investors willing to build a portfolio of more economically sensitive companies.

You'll notice that the overvaluation at the 2000 peak was really dominated by extreme valuation in the top decile of price / revenue ratios.

Stock prices are up and valuations are at extreme levels despite faltering earnings, Fed rate hikes and a slowing economy.

Despite my admitted stumble in the half - cycle since 2009, it's perplexing that the equity market is at the second greatest valuation extreme in the history of the United States, on what are objectively the most durably reliable valuation measures available, but it has somehow become an affront to suggest that this will not end well.

Even the decile with the best relative valuation is at the most extreme level in history.

But this reasonably good outcome results precisely from the fact that the extreme valuations at the 1987 peak are roughly matched by the extreme valuations of today.

Respect that distinction without abandoning valuations altogether, and recognize that at least for now, the combination of obscene overvaluation, extreme overvalued, overbought, overbullish conditions, and divergent market internals creates a terribly hostile return / risk profile for investors.

At present, we continue to identify one of the most hostile market environments we've observed in a century of historical data, not only because obscene valuations and extreme «overvalued, overbought, overbullish» syndromes are in place, but also because our measures of market internals remain in a deteriorating condition.

This private equity investment mark - to - market «Picasso» leads to extreme «over-marking» of private equity investment valuations at pension funds.

The S&P 500 registered a record high after an advancing half - cycle since 2009 that is historically long - in - the - tooth and already exceeds the valuation peaks set at every cyclical extreme in history but 2000 on the S&P 500 (across all stocks, current median price / earnings, price / revenue and enterprise value / EBITDA multiples already exceed the 2000 extreme).

It was a veiled warning that when valuations are at extremes — as they are today — it doesn't take much to trigger something serious.

I just have to be able to understand that risks are dramatically rising when you have such extreme valuations at the same time you have rising interest rates and a tightening of monetary policy.

Well, revenue growth would contribute 4 % annually if the price / revenue ratio was to remain at record extremes, but otherwise, we've also got to consider the effect of the change in valuations.

At the most extreme valuations in history.

My goal is to use the historical data to develop an approach to investing that avoids the negatives at both extremes of valuation: (1) being too heavy in stocks at times of overvaluation; and (2) being too light in stocks at times of undervaluation.

My view is that it is best to maintain a moderate position in stocks at times of high valuation and that it is also best not to go too extreme on the high side in one's stock allocation at times of low valuation (because in the short - term stocks may drop sharply even from a starting point at which valuations are low).

Equally worthy of note, the very same valuation measures during the bullish peaks in the 20 - year period never approached the mindless extremes that exist at present.

In this article published in the Herald Sun, Roger discusses how when valuations are at extremes, it doesn't take much to trigger something serious.

The manager will make tactical shifts in the fund's asset mix when he feels that stock or bond valuations are at an extreme.

Indeed, the risk of hold - n - hope at a time when valuation levels are extreme and market internals are sketchy is a recipe for disaster.

The second risk is far more dangerous: investing when relative valuations are at an extreme — aka performance chasing.

At the other extreme, valuation metrics need not have any effect on equity returns if those returns all come from price appreciation (capital gains).

The tendency for valuations to remain at extreme levels relative to history for years or even decades makes contrarian asset allocation a frustrating and dangerous exercise.

Those differences are informative, because they highlight points where market valuations — instead of normalizing — reached historic extremes at the end of the 10 - year projection horizon (1974, 1998 - 2000 and 2015, respectively).

Despite my admitted stumble in the half - cycle since 2009, it's perplexing that the equity market is at the second greatest valuation extreme in the history of the United States, on what are objectively the most durably reliable valuation measures available, but it has somehow become an affront to suggest that this will not end well.

Meanwhile, stock valuations are at historical extremes in terms of price - to - earnings ratios, dividend yields, book values and projected corporate earnings.

«Momentum (growth) stocks trade at an extreme premium to value stocks, with the valuation spread the highest since 1980, except for during the tech bubble,» JPMorgan strategist Dubravko Lakos - Bujas wrote recently.

It may seem implausible that stocks could have gone this long with near - zero returns, and yet still be at valuations where other secular bear markets have started — but that is the unfortunate result of the extreme valuations that stocks achieved in 2000.

In both cases, stock valuations were pushed to historical extremes as all - time market highs occurred on a seemingly weekly basis (roughly one - fourth of 2017's trading days ended at a new all - time high!).

Valuation extremes would need to become valuation bargains or, at the very least, the Federal Reserve would need to expand its balance sheet (QE / QE - like activity) yValuation extremes would need to become valuation bargains or, at the very least, the Federal Reserve would need to expand its balance sheet (QE / QE - like activity) yvaluation bargains or, at the very least, the Federal Reserve would need to expand its balance sheet (QE / QE - like activity) yet again.