| Both charts illustrate how expensive the S&P 500 is relative to the rest of the world, with these differences being rarely larger over the past 20 years. The S&P 500 is trading significantly above its historical average valuations and yields less than it typically does on average. Equity markets outside the U.S. are currently trading at nearly a 36% discount to the S&P 500 on a forward earnings basis, compared to the typical 17% discount. Additionally, the S&P 500 is yielding only 1.4%, while the rest of the world is yielding 3.2%. This indicates that international markets could be fertile hunting grounds for investors seeking value and yield. |