Charts: US Equities
The market ebbs and flows across time – driven by greed, and speculation on one side and fear, uncertainty and doubt on the other.
Yet, I do believe that the diversified portfolio of the US largest firms remain the safest asset class. Yet, that doesn’t mean they are attractive at any price. In fact, waiting for the right time to buy MAY actually be a great way to play the game IF you can find an adequate rate of return using an alternative method. (and with some creativity you can!)
So here are some ratios that remind you where the market is with relation to historical records.
SP500 / Gold Ratio
Emerging Markets / SP500
Nasdaq 100 (Tech) / SP500
Mid Cap (Blended) / SP500
Small Cap (Blended) / SP500
Value (SP900) / SP500
Growth (SP900) / SP500
A few more things could be looked (in addition) at to evaluate BUY or SELL signals to manage risk.
1. PUT/CALL ratio : You’d like to not buy when the ratio is under 0.75 and possibly buy when its over 1.
2. Volatility : When volatility is at a low (especially around lines of support), the risk of downside is higher as volatility is expected to rise.