Category: Daily Instagraph

As we approach year-end, implied volatility across equities, bonds and FX has fallen back towards 12-month lows. This likely reflects a certain complacency among investors who, after a generally good year for equity and balanced portfolios, hope to be “saved by the closing bell”. We should, however, be careful not to mistake this calm for … Continued

Today’s graph from MarketDesk shows the median next-12-month P/E ratios across the S&P 500, sorted by market-cap buckets. The headline index trades around 22x earnings, but the Top 10 names are much richer at 27.4x 12-month forward earnings. As you move down the index, valuations become less stretched, with the smallest 200 stocks in the … Continued

The stock market has turned the global obesity and diabetes epidemic into a two-horse race between Novo Nordisk and Eli Lilly. Today, almost all investor focus is on the market shares of their GLP-1 franchises and on the potential success of oral versions of these anti-obesity drugs. Today’s graph shows Novo Nordisk’s P/E ratio versus … Continued

The S&P 500 is up 16.1% year-to-date as of yesterday’s close. Barring a correction in December, 2025 will be one of the green years in this 150-year history of S&P 500 returns. Once again, it was a year full of drama: geopolitical tensions, tariffs and trade negotiations, and ongoing debates about the Fed. We are … Continued

Today’s chart shows the S&P 500 trading at 5.3x book value – the highest level since WWII. Many investors question how useful book value still is as a yardstick. With the rise of technology and services, businesses have become less capital-intensive, while years of M&A have filled balance sheets with goodwill and other intangibles that … Continued

Today’s graph compares inflation-adjusted public pensions per head with compensation per employee. Across Europe, public pensions have risen significantly faster than salaries. In particular, countries hit hardest by the Eurozone crisis — such as Greece, Italy, and Spain — have seen stagnating or even falling wages. Interestingly, the burden of internal devaluation to regain competitiveness … Continued

Germany’s economy has clearly lost competitiveness. Over the last 25 years, GDP growth has been modest and recently even turned negative. One major reason: private capital investment increased by only ~15%, while government consumption surged by ~60%. When the State expands and private investment stagnates, productivity and competitiveness inevitably suffer.

Today’s graph from Crescat Capital LLC highlights a stark divergence: large-cap US tech has sharply increased its capital investment since COVID, while the broader US mid-cap universe — representative of the real economy — has cut CAPEX by roughly 30% vs. pre-pandemic levels. One can argue that Big Tech may be flirting with over-investment in … Continued

Europe needs to spend more on defence, and the political will is now clearly translating into actual numbers. The European Commission’s €800 billion “Readiness 2030’’ programme even allows temporary exceptions from fiscal rules — a major shift in mindset. In addition, Europe announced €150 billion in EU defence loans (“SAFE”). Germany suspended its constitutional “debt … Continued

The US market as a whole is expensive — both relative to its own history and compared to the rest of the world. But does that mean we should avoid US equities entirely? At ECP, we don’t think so. We continue to allocate capital to US equities, with one important caveat: we now invest much … Continued