CMG Capital Management Group CEO Steve Blumenthal analyzes stock valuations and projected forward returns of the U.S. equity market for a column in The Wall Street Journal. Excerpt:
“Valuation metrics can tell us a lot about probable forward returns,” says Mr. Blumenthal. The table helps drive home the point that buying stocks when they are reasonably priced relative to company earnings increases the odds of decent long-term returns. By contrast, historically when the P/E ratio was at a high level, the index didn’t perform well over the next 10 years, he says.
See the full story in The Wall Street Journal: Aha! How Stock Valuations Can Shape Long-Term Returns.