In this episode Mark discusses the importance of understanding market valuation to navigate the current financial landscape. Mark explains the differences between being a shareholder and a bondholder and dives deep into the concept of the Price to Earnings (PE) ratio and its significance in evaluating stocks.
He explains how to calculate the PE ratio of the S&P 500 Index and compares it historically. Mark also introduces the cyclically adjusted PE ratio (CAPE ratio) to account for market fluctuations and discusses the Earnings Yield compared to the 10-year Treasury yield.
He provides insights into various valuation models and their current relevance. Mark wraps up by sharing Warren Buffett's wisdom on market fluctuations and encourages investors to maintain a long-term perspective, particularly during market corrections.
If you would like your question answered on the show, please send an email to [email protected] and put “podcast question” in the subject line.
Episode Links:
Mark’s Money Mind YouTube Channel
Reply on Your Investment Policy Statement During Rocky Markets | Episode 040
Current Market Valuation website
1997 Berkshire Hathaway Chairman’s Letter
Timestamps:
In this episode of Mark discusses a Wall Street Journal article titled 'Retiring in the Next Five Years? Avoid These Financial Mistakes', adding his...
In this heartfelt episode, Mark dedicates this show to his late niece Emily, sharing valuable lessons from her life and how they align with...
Mark Trautman, Bill Yount, and Becky Heptig dive into the Secure Retirement Income Process created by the co-host of The Retirement and IRA Show....