Cap Ratios
Another Chance To “Buy High”
Despite this year’s massive underperformance by the Equal Weighted S&P 500, the median stock doesn’t appear substantially more attractive than the cap-weighted index. Three of five valuation measures are now back in the top decile of readings, which we’d consider pricey in any monetary or economic backdrop.
Stock Market Observations
This bull market has appeared to be on shaky technical ground before, only for concerns to be swept aside. This time, we think it’s different.
Small/Mid/Large Caps
Small cap premium spikes back up.
Small/Mid/Large Caps
Small Caps are selling at a 17% valuation premium relative to Large Caps (19% last month), using non-normalized trailing operating earnings. The Small Cap sell-off over the last three months has pushed us away from the recent peak premium of 23%.
Small/Mid/Large Caps
Small Caps are selling at a 19% valuation premium relative to Large Caps (23% last month).
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