This Time-Tested Metric Has Foreshadowed Virtually Every Major Stock Market Downturn This Century -- and It's Sounding a Warning Right Now
Outsize risk-taking by investors is one of Wall Street's biggest and most accurate red flags.
Overview
Roughly one month ago, the ageless Dow Jones Industrial Average (DJINDICES: ^DJI), benchmark S&P 500 (SNPINDEX: ^GSPC), and growth-stock-powered Nasdaq Composite (NASDAQINDEX: ^IXIC) all blasted to record highs, driven by artificial intelligence euphoria and better-than-expected corporate earnings.
But this historic Wall Street rally may not be as strong as the Dow, S&P 500, and Nasdaq indicate. While historical precedent can't concretely guarantee what's to come, the past can act as a teaching tool for investors more often than not.
Details
One time-tested metric, reported monthly, has had an uncanny ability to foreshadow significant stock market downturns since the start of this century -- and for the first time in roughly five years, it's sounding an unmistakable warning.
Source
Originally published at www.fool.com.