AdvertisementAdvertisementDespite rising interest rates, higher oil prices, and ongoing labor strikes, investors should stay bullish on the stock market.
But since 2021, 50% more large caps have become small caps than small caps becoming large caps (the reverse of prior decades), suggesting a purge of weaklings.
comparing the earnings yield based on the S&P 500 PE of 20x to nominal Tsy yields of 5%.
"The equal-weighted S&P 500 ERP is 50bp+ higher than the cap-weighted S&P 500, and trades at 17x on trough earnings.
The equal-weighted S&P 500 also almost always beat the cap-weighted S&P 500 in past 'Recovery' cycles."
Persons:
Bank of America's Savita Subramanian, Subramanian, —, Savita Subramanian
Organizations:
Bank of America's, Service, Bank of, Boomers