Pick stocks

Today’s analysis focuses on the relationship between the cyclically adjusted P/E (CAPE) of the S&P 500 and the inflation-adjusted returns of the index over the following 10 years. Historically, whenever such normalized valuations have reached current levels, the subsequent decade of returns for the S&P 500 has been either low or negative. If history serves as a guide, now is therefore not an opportune moment to invest broadly in an S&P 500 ETF. At ECP, we take a different approach. As value investors, we carefully select individual stocks and explore opportunities beyond U.S. markets to deliver better long-term outcomes.