Search Results for: R²

S&P 500 Normalized P/E vs. Subsequent Annualized Returns The current S&P 500 normalized P/E suggests that equity investors should expect annual price returns of -0.8% over the next 10 years (R² = 0.79). Image: BofA US Equity & Quant Strategy

Truck Tonnage vs. S&P 500 Index The Truck Tonnage Index decreased by 1.2% in July. Trucks represent 72.5% of U.S. freight and serve as a barometer of the U.S. economy. This chart shows that the U.S. stock market tends to increase in line with the physical size and expansion of the U.S. economy (R² =…

Coronavirus – Hospitalizations vs. Vaccinations The negative relationship between hospitalizations and vaccinations is significant (R² = 0.55). Image: BofA Global Research

MSCI World Value vs. Growth Relative Index and U.S. 10-Year Real Yields Value tends to outperform growth as U.S. real rates rise (R² = 0.93). Image: Morgan Stanley Research

Inflation vs. S&P 500 Trailing P/E The U.S. equity market tends to see multiple compression when inflation rises (R² = 0.54). Image: BofA US Equity & Quant Strategy

U.S. Core Inflation Expected Over the Next 21 Months (Leading Indicator) M2 velocity year-over-year tends to lead U.S. core CPI by 21 months (R² = 0.52 since 1996).  It has been quite accurate for more than 20 years. Click the Image to Enlarge

S&P 500 CAPE Valuation and Following 10-Year Annualized Returns Since 1950 Does valuation still matter in the long run? Elevated CAPE ratio suggests anemic stock market returns over the next 10 years (R² = 0.467 since 1950). Image: Real Investment Advice

S&P 500 Sector Return on Equity vs. Price/Book Valuation Sector valuations are well-ordered relative to profitability (R² = 0.85). Image: Goldman Sachs Global Investment Research

U.S. Macro Fundamentals vs. S&P 500 This chart shows the current wide divergence between U.S. lead indicators and the S&P 500 (R² = 0.97). Image: Pictet Asset Management