Stretched valuations imply concentrated. US stocks valuations haven't been negatively concentrated or "stretched" since 1997-2000. Although US stocks were positive concentrated or extremely "compressed" in 2009, few other than Warren Buffett and quiet money, a world that doesn't care about the two F's, were following their message.
Headline: Goldman Says There's an Elevated Risk of a Big Market Selloff
"With the S&P 500 close to all-time highs, stretched valuations and a lack of growth, drawdown risk appears elevated." So says Goldman Sachs Group Inc. Managing Director Christian Mueller-Glissmann, who highlights that selloffs in excess of 20 percent for major bourses occur relatively frequently and recently have been brought about by concerns of a global nature. With a possible Brexit, the U.S. presidential elections, and a Fed that appears committed to continuing to lift policy rates, this level of event risk is certainly on the table.
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