Trapeze Asset Management
The S&P 500 is at a record high and we believe the markets generally are fully valued. Corporate revenue growth is anemic, profit margins are stretched, and the prospect of earnings rising meaningfully is not high. And, the outlook for the U.S. and global economy is still uncertain. Market psychology is at a level suggesting the market is overbought, Margin debt is at record levels and the current popularity of stocks by retail investors at market highs is in itself a red flag. The equity markets have benefited from the huge inflows from low-yielding bond funds into U.S. equity funds.
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