Search Results for: R²

Truck Tonnage vs. S&P 500 Index The Truck Tonnage Index decreased by 2.3% in October. 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 =…

S&P 500 Sector Return on Equity vs. Price/Book Valuation Sector valuations are well-ordered relative to profitability (R² = 0.88). Image: Goldman Sachs Global Investment Research

Cumulative Growth of Fed Balance Sheet and S&P 500 Index Cumulative Growth The large expansion of the Fed’s balance sheet tends to push the S&P 500 Index higher (R² = 0.829 since 2009). Image: Real Investment Advice

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

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