The Market Hasn't Done This in 25 Years: Should You Be Concerned?

It is no secret that stock valuations, especially among large-cap stocks, are running hot. After a bull market that's run for more than three years, with the S&P 500 returning 23%, 24%, and 16%, respectively, in the last three calendar years, valuations were bound to rise.But they have reached historically high levels, at least according to one key valuation metric, the Shiller P/E ratio, also known as the cyclically adjusted P/E (CAPE) ratio. The Shiller P/E ratio, named for the man who developed it, Nobel laureate economist Robert Shiller, looks at the market price of an index, typically the S&P 500, in relation to the inflation-adjusted earnings over a 10-year period.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool