{"id":7044,"date":"2017-07-07T13:00:19","date_gmt":"2017-07-07T13:00:19","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=7044"},"modified":"2017-07-07T13:00:19","modified_gmt":"2017-07-07T13:00:19","slug":"sp-500-remains-reasonably-valued","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=7044","title":{"rendered":"SP 500 Remains Reasonably Valued"},"content":{"rendered":"

Dr. David Kelly and the JP Morgan research team publish a quarterly “Guide to the Markets” which I’ve always thought was an excellent 70-odd page summary of economics, capital markets, style boxes, and all manner of investment-related information in one package.<\/p>\n

The attached spreadsheet below is my own crude way of tracking the Guide’s valuation matrix, which is a quick and very helpful synposis of the SP 500’s valuation at a glance.<\/p>\n

JPMGTTMSP500Valmeasures<\/a><\/p>\n

If readers would look at the “standard deviation column” for each quarter, you can see that relative to long-term averages, the SP 500’s valuation metrics remain in a “normal” range.<\/p>\n

Even all the nervousness about the FANG stocks (long all but Netflix), and the concentration in the top 5 – 10 names in the SP 500, which brings back memories of the late 1990’s today, however if you scrutinize the Nasdaq 100, the key index is valued at roughly 23(x) – 25(x) earnings, versus the 80(x) – 100(x) multiple from the late 1990’s.<\/p>\n

Here is another fascinating graph by Bespoke published yesterday:<\/p>\n

“Run of the Mill” Market Returns<\/a><\/p><\/blockquote>\n