At the beginning of September, in a presentation stretching across 102 slides, Goldman Sachs presented its case for where the bank believes investors should be putting their cash in the current market. Goldman has three critical debates that are driving three investment themes. The three debates are as follows:
- Rates
Goldman expects the Fed will hike in December. The bank’s analysts note that P/E multiples have historically compressed by 8% during the 90 days after initial tightening but recover soon after
- Valuation
On most metrics, the S&P 500 currently trades at a fair value. The median stock has a forward P/E multiple of 16x, the 83 rd percentile since 1976
- Dispersion
The market is plagued by a low return...Login required to continue reading.
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