Not much changed in 2015. U.S. stocks started the year expensive based on the cyclically-adjusted price earnings ratio (“CAPE”) and ended the year expensive, whereas most of Europe started the year cheap and ended the year cheap. Joachim Klement of Wellershoff & Partners Ltd. broke out the numbers, making macroeconomic adjustments to account for GDP growth and interest rates.
As any value investor knows, cheap stocks can stay cheap for a long time, and expensive stocks can get ludicrously more expensive. But over the course of a full market cycle, returns tend to revert to the mean. So while I cannot promise that this will be the year that international stocks outperform American stocks, I can at least tell you that the odds are in our favor, at least over a time horizon of a couple years.
Source: Charles Sizemore
Related Articles:
- A Disciplined Approach To Dividend Growth Stocks
- 5 Low Beta, Higher Yielding Dividend Stocks For The Next Downturn
- 7 High-Yield REITs With Growing Dividends
- 26 Income Securities For A Well-Rounded Asset Allocation
- International Diversification May Be Closer than You Think
CAPE: Market Values Around the World
Posted by D4L | Thursday, January 21, 2016 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
In an attempt to put a lid on inflation, the Federal Reserve has stated that it intends to raise its benchmark federal-funds rate by 0.25% a...
-
If you have contemplated selling shares of some of the companies you own this year, you likely aren't alone. Considering how volatile th...
-
Dividend Kings, stocks with at least 50 consecutive years of dividend growth, are favorites of many income investors. High-dividend yields c...
-
Dividend growth stocks are among our favorite investment groups because you get so much bang for your buck. Not only do the companies pay di...
-
Readers may want to do a stock valuation on the stocks in their favorite sectors and wait patiently until they become cheap. Patience is a v...
-
This is a clear recipe for investors to follow, and will lead us quite naturally to two recent stock recommendations from Morgan Stanley’s a...
-
Dividend utility stocks might seem bad for your portfolio during high inflation and rising interest rates. However, the sector has done well...
-
Companies that have either been through past downturns or have the pricing power to offset the costs of inflation provide a crucial element ...
-
Dividend reinvestment plans, or DRIPs, can be effective ways to accumulate shares of high-quality companies for those with limited capital t...
-
Do you have the stomach for contrarian investing - betting against the crowd? Sometimes that's necessary in order to find value. Why buy...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.