kitces chart01 jpg

Summary: above 20 5 0 when P E10 is between 12 and 20 and 5 5 when P E10 is below 12 For today s S P 500 in the 1 200 range the P E10 is about 23 The chart below illustrates these results The other interesting relationship that Kitces describes is the correlation between optimal asset allocation and P E10 He found that even in times of high valuation i e P E10 = 20 44

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