Where Will the Bear Market Bottom? 2 Valuation-Based Indicators Offer a Clear Range
This has been a year that's tested the resolve of professional and everyday investors alike. The first half of the year saw the benchmark S&P 500 (SNPINDEX: ^GSPC) produce its worst return since 1970. Meanwhile, the growth-stock-driven Nasdaq Composite (NASDAQINDEX: ^IXIC), which was largely responsible for pushing the broader market to new highs, has plunged as much as 34% since hitting its mid-November record close.
With the S&P 500 and Nasdaq respectively declining 24% and 34%, respectively, at their peaks, both indexes have firmly entered bear market territory. Given the heightened volatility and uncertainty that accompanies bear markets, it has a lot of investors wondering where the market will bottom.
Officially, we have no clue. If there was an indicator that was right 100% of the time, everyone would be using it. But we do have two valuation indicators that have a pretty successful track record of calling bear market bottoms.
Source Fool.com
