Growth at an Unreasonable Price?

The stock market’s breadth is high and nothing is cheap. Everything seems to be rocketing right now, technology, banks, energy (green and brown), industrials, bonds, IPOs and even crypto. It’s a precarious place for a discerning investor.

It’s not that I’m unaware of low interest rates, or potential fiscal stimulus, or even SaaS company growth rates. The narrative is you can pay any multiple you want for growth; We are in the early stages of a cyclical rebound with a vaccine on it’s way and a government willing to print. 

If printing money was the solution, it would have been discovered before. 

Right now the S&P 500 Forward P/E ratio is 26 and the Shiller P/E ratio is 34, the highest since year 2000. This is with a tremendously uncertain economic backdrop.

I’m reducing my position sizes, trimming grossly overvalued stocks, and adding hedges here. I’ve taken my net long exposure down from 80% to 64% in the last week. 

I’m not constructive on a market of very few bargains and innumerable geniuses.

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