If a Stock Market Crash Is Coming, History Says Investors Who Do This 1 Thing Will Win Out
It's simpler than you might think to build a recession-proof portfolio.
Overview
The market has been wobbly lately, with the S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) dipping by nearly 3% and 6%, respectively, over the past month.
Some stock market indicators are also sounding the alarm. The S&P 500 Shiller CAPE Ratio, which measures whether the index is over- or undervalued, is reaching heights not seen since the dot-com bubble burst. Back then, the ratio reached a record high of around 44. As of this writing, it's just over 41, the second highest point in history.
Details
The Buffett indicator, named after Warren Buffett, is also at record highs. This metric measures the relationship between the total value of U.S. stocks and GDP, and according to Buffett himself, investors are "playing with fire" when it nears 200%. Currently, this metric sits at around 234%.
Source
Originally published at www.fool.com.