How to Find Opportunities When Market is Overvalued?

The Market (Dec. 2020) is Overvalued Even though millions of people in the US are hoping for another COVID-19 relief to save them from eviction and poverty, it is pretty obvious that the current (US) stock market is overvalued. The chart below shows that the price/earnings (PE) ratio of the S&P 500 has reached the … Read more

Patterns of Price/Earnings Ratios among Sectors and Company Sizes

I recently came across an interesting fact in Value Investing: from Graham to Buffett and Beyond about the relationship between the price to earnings ratios (P/E) of small cap companies and the market. According to the authors of the book, “[G]enerally the small caps P/Es are higher, befitting their more realistic prospects for growth. In 1983, . … Read more

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