I’ve been reading up on how people use things like discounted cash flow or earnings yield to estimate the intrinsic value of the S&P 500. It’s fascinating, but also a bit complex. You’re not just looking at one company’s cash flows, you’re aggregating the expected future earnings of all these companies
don’t forget inflation and interest rates, which are huge factors in those calculations, especially now. If rates are high, the future cash flows are worth less today, which can make the intrinsic value of the index lower. That’s why understanding the bigger picture is crucial.
That’s what makes this so tough to pin down. It’s not just about doing the math on current earnings; it’s about predicting future growth, accounting for macroeconomic factors, and figuring out whether the market’s optimism or pessimism is justified. Honestly, I’m not sure how accurate my own calculations are when I try to do them
I try to follow analysts' reports, but they don’t always agree either. Some say the S&P 500 is overvalued right now because growth expectations are too high, while others think we’re in a good position long term because of the strength of tech and healthcare sectors
You know, this is where I think a financial advisor can really help. When I first started out, I was trying to do all of this on my own, reading reports, crunching numbers, and still not being sure if I was making the right decisions. But when I started working with a financial advisor, things got a lot clearer
My advisor, Peter Dewitt Martin, doesn’t just help me figure out the valuation, but also gives context to what that number means in the current market. He walked me through different valuation models and helped me understand when to use them. For example, he showed me how to look at the earnings yield of the S&P 500 and compare it to bond yields to see if stocks are relatively expensive or not. My portfolio has gone up exponentially
the problem with waiting for the SPX to come down to it's intrinsic value is that it might not happen anytime soon and in the mean time you are sat on the sidelines and missing out on gains while your money is getting eaten away by inflation. always remember, the goal of investing is to make money...not to be "right"
Who said we Will sit on the sidelines and wait for S&P in bonds with 4-5% pa return? :D :D There are so many investment instruments and many of them are undervalued. Offering much better returns then S&P 500 for next few years ;) Its simple: Buy what is undervalued and ignore (put on your watchlist) assets which are overvalued ;) In next few years situation will change. So we will be able to switch assets in portfolio.
While being always pessimistic about the stock market you leave a lot of money on the table for the sake of being right once every 20 years. By the way Damodaran, the dean of valuation just came up with a much higher intrinsic valuation.
He doesn't leave money on the table: he simply does not gamble with an index that trades at 30x earnings. You need 10% annual growth AND a sustained 30x multiple in order to earn a 10% return from 6,000. Earnings growth has never been 10% in the first place, not one year, let alone over a decade. Multiples have never stayed above 30x. With the average 6% earnings growth and a 15/20/25 multiple 10 years down the road, you are looking at a pathetic 1.0/3.5/5.5/% return. Simple math.
value investing is about absolute returns, you can follow academics and have intelligent models, or you can apply a minimum required rate of return, use it to compare investments and compound over the long term. If you think too much about the discount rate, you end up focusing on that, not on good investments!
I use a slightly different method looking at earnings growth in the last 5 years which hopefully takes into account some moderate upward sentiment as is the case lately. My figure is somewhere between 3800 and 4800 with some moderate-high upward sentiment. At over 6000 the value seems to be driven by over enthusiasm. I did reduce my exposure to sp500 by 60-70% but I'm happy to continue to pay into a sp500 tracker fund relativley small amounts on a monthly basis from a significantly lower overall exposure. My main holdings at the moment comprise a money market fund followed by a european large cap tracker and the sp500 tracker.
@nubbyrose87 I am not comfortable with investing in non-market cap weighted funds because the fact of the matter is that the Mag 7 are also responsible for most gains in the sp500. I am far more comfortable with simply reducing my exposure if I think that the index comprising the Mag 7 is overpriced. Further, the Mag 7 are overpriced but so are other companies within sp500 - e.g. TXN has a comparable PE with MSFT. Finally, not all the Mag 7 are overpriced by the same margin in my view, some are ridiculously overpriced and some are actually closer to what they should fetch because they truly are unicorns.
The thing is how do you calculate real risk when you have a Federal Reserve that will do everything in its power to hold up prices? One can't get to real "value" when the inputs are not real.
I measure US public debt to measure inflation and debasement. US debt $400 billion 1970, $36,000 billion in 2025. That is an annual growth rate of 8.2%. Few things can keep up. Gold was 35 IOUs 1970, now gold is 2,800 IOUs. Gold did 7.99% "growth". Dow 1970, $800, now $42,000, Dow up 7.22%, plus dividends, minus fees and taxes. New house up 5.37% since 1964. Where to hide? We all lose to inflation. IOU Hoax is a beautiful hoax, humorous and malicious. LOL. Thanks Sven.
The mere 7% earnings growth is pretty sobering considering all of the money printing, internet and globalization. Really shows the impact of money printing and deficit spending. Will the day of reckoning ever come?
This is irrelevant. Not saying it wont drop to 3000, but it wont be because it is expensive, but because of the actual reason why market move, which is global liquidity. Fundamentals on sp500 are much less relevant
Dr. Carlin… Would really love to get your take on Crocs (ticker: CROX), Grupo Aeroportuario del Centro (OMAB) & Wise plc. I have full positions in all three of these equities and would love to get your unique value-centric critique of them. Thanks Sven
I'm ecstatic with the outcome of the election and the year-end market surge. Which hidden jewels in the upcoming bull run would you buy with a 100K right now? My goal is to position myself for a prosperous Q1 in 2025.
Index Funds & ETFs: 40-50%, Emerging Markets (e.g., VWO): 10-15%, Dividend Stocks: 10-20%, Growth Stocks/Small-Caps: 10-20%, REITs: 5-10% Remember to always work with a knowledgeable person in the financial market when starting out to avoid getting burnt.
“DCA" is the golden term but the key. My dollar portfolio i DCA with is made up of 30% PLTR, 25% NVDA, 15% VOO and over 30% in digital assets, thanks to my CFA. This strategy is what works for my spouse and I. We've made over 80% capital growth minus dividends. Q3 taxable divs this year was $18,388.
I'll be kind to leave just her name here ''Monica Lisa Payne''. She's a renowned figure in the financial sector with over two decades of experience. I'd suggest you research her further on the web.
I'm new to BTC and l've been making losses trying to make profit myself in trading.. I thought trading demo account is just like trading the real market... Can anyone help me out or at least advise me on what to do?
As a beginner investor, it's essential for you to have a mentor to keep you accountable. Mrs. Mona Moayer gaines is my trade analyst, she has guided me to identify key market trends, pinpointed strategic entry points, and provided risk assessments, ensuring my trades decisions align with market dynamics for optimal returns.
Just swapped all of my last ETH and swapped it into XAI521K$. Already up a little bit. Unfortunately I have some other junk staked which won’t free up for a while. Still now I am on the train!
Thanks for the update. I advise traders, especially beginners, to research the market before entering it. I have to say that trading is more rewarding than just owning. Big thanks to Henry mark who always keeps me updated. I am so glad I started his program.
An idiot with a spread sheet. I guess the whole market is wrong and only Sven is right. If you are so smart why don't you have a hedge fund and sell your stock picking to institutional investors instead of selling a course on you tube ?
Nothing screams "speculator" like somebody offended by data and rational arguments. What exactly do you expect? Multiples in the 30s and 40s in perpetuity? With 6% earnings growth and a 20/25/30 multiple 10 years down the road, you are looking at a pathetic 3.5/5.5/7.5% return. Simple math.
@ Future SP500 PE ratio is currently 24. The market is pricing 25% EPS growth for 2025. You can ask this scammer Sven to update his spread sheet and show us the results
@@aleksandarbalov9236 It doesn't matter if it is a bubble right now. You argued for trust in the wise market when history contradicts your point. It isn't just Sven, Warren Buffet, just as an example, seems to be hedging for a big correction too and he manages billions of dollars - your ad hominem doesn't work here.
I’ve been reading up on how people use things like discounted cash flow or earnings yield to estimate the intrinsic value of the S&P 500. It’s fascinating, but also a bit complex. You’re not just looking at one company’s cash flows, you’re aggregating the expected future earnings of all these companies
don’t forget inflation and interest rates, which are huge factors in those calculations, especially now. If rates are high, the future cash flows are worth less today, which can make the intrinsic value of the index lower. That’s why understanding the bigger picture is crucial.
That’s what makes this so tough to pin down. It’s not just about doing the math on current earnings; it’s about predicting future growth, accounting for macroeconomic factors, and figuring out whether the market’s optimism or pessimism is justified. Honestly, I’m not sure how accurate my own calculations are when I try to do them
I try to follow analysts' reports, but they don’t always agree either. Some say the S&P 500 is overvalued right now because growth expectations are too high, while others think we’re in a good position long term because of the strength of tech and healthcare sectors
You know, this is where I think a financial advisor can really help. When I first started out, I was trying to do all of this on my own, reading reports, crunching numbers, and still not being sure if I was making the right decisions. But when I started working with a financial advisor, things got a lot clearer
My advisor, Peter Dewitt Martin, doesn’t just help me figure out the valuation, but also gives context to what that number means in the current market. He walked me through different valuation models and helped me understand when to use them. For example, he showed me how to look at the earnings yield of the S&P 500 and compare it to bond yields to see if stocks are relatively expensive or not. My portfolio has gone up exponentially
I love it when Sven gets all intrinsic on us.
Shouldn’t the mag 7 be reviewed separately from the other 493 stocks? They account for 1/3 of the market cap and have higher P/E ratios.
the problem with waiting for the SPX to come down to it's intrinsic value is that it might not happen anytime soon and in the mean time you are sat on the sidelines and missing out on gains while your money is getting eaten away by inflation.
always remember, the goal of investing is to make money...not to be "right"
Who said we Will sit on the sidelines and wait for S&P in bonds with 4-5% pa return? :D :D
There are so many investment instruments and many of them are undervalued. Offering much better returns then S&P 500 for next few years ;)
Its simple: Buy what is undervalued and ignore (put on your watchlist) assets which are overvalued ;)
In next few years situation will change. So we will be able to switch assets in portfolio.
Nobody is sitting on the sidelines here: we simply don't care about (nor gamble with) your goofy index trading at 30x earnings.
While being always pessimistic about the stock market you leave a lot of money on the table for the sake of being right once every 20 years. By the way Damodaran, the dean of valuation just came up with a much higher intrinsic valuation.
He doesn't leave money on the table: he simply does not gamble with an index that trades at 30x earnings.
You need 10% annual growth AND a sustained 30x multiple in order to earn a 10% return from 6,000.
Earnings growth has never been 10% in the first place, not one year, let alone over a decade. Multiples have never stayed above 30x.
With the average 6% earnings growth and a 15/20/25 multiple 10 years down the road, you are looking at a pathetic 1.0/3.5/5.5/% return. Simple math.
I don't follow Damodaran, but I see that he is on CNBC often: you don't get on CNBC by describing reality.
Have you considered stocks buy backs?
yes, in the growth rate
@Value-Investing great, thanks
Can you do an analysis of intrinsic value for General Motors please?
Shouldn't discount rate be close to ten year note, not 10 pct?
How are current interest rates incorporated into your model? Or are you assuming everything is growing at the mentioned rates plus inflation
value investing is about absolute returns, you can follow academics and have intelligent models, or you can apply a minimum required rate of return, use it to compare investments and compound over the long term. If you think too much about the discount rate, you end up focusing on that, not on good investments!
I use a slightly different method looking at earnings growth in the last 5 years which hopefully takes into account some moderate upward sentiment as is the case lately. My figure is somewhere between 3800 and 4800 with some moderate-high upward sentiment. At over 6000 the value seems to be driven by over enthusiasm. I did reduce my exposure to sp500 by 60-70% but I'm happy to continue to pay into a sp500 tracker fund relativley small amounts on a monthly basis from a significantly lower overall exposure. My main holdings at the moment comprise a money market fund followed by a european large cap tracker and the sp500 tracker.
Shouldn’t you consider the mag 7 separately from the other 493 stocks? Aren’t those stocks 70% of the market cap of the S&P 500?
@nubbyrose87 I am not comfortable with investing in non-market cap weighted funds because the fact of the matter is that the Mag 7 are also responsible for most gains in the sp500. I am far more comfortable with simply reducing my exposure if I think that the index comprising the Mag 7 is overpriced. Further, the Mag 7 are overpriced but so are other companies within sp500 - e.g. TXN has a comparable PE with MSFT. Finally, not all the Mag 7 are overpriced by the same margin in my view, some are ridiculously overpriced and some are actually closer to what they should fetch because they truly are unicorns.
The thing is how do you calculate real risk when you have a Federal Reserve that will do everything in its power to hold up prices? One can't get to real "value" when the inputs are not real.
Sven, how do you think markets will respond on Monday with US/Canada/Mexico tariffs announced? Fear in the markets?
10% decline
I wouldn’t take swing trade advice from Sven lol
Probably already priced in.
Robinhood after hours is down like a percent already
Sven i Will love to see a analyses to AMD. Intrinsic value. Financial. And moat of company
intrinsic value is the equivalent of moral victory
I measure US public debt to measure inflation and debasement. US debt $400 billion 1970, $36,000 billion in 2025. That is an annual growth rate of 8.2%. Few things can keep up. Gold was 35 IOUs 1970, now gold is 2,800 IOUs. Gold did 7.99% "growth". Dow 1970, $800, now $42,000, Dow up 7.22%, plus dividends, minus fees and taxes. New house up 5.37% since 1964. Where to hide? We all lose to inflation. IOU Hoax is a beautiful hoax, humorous and malicious. LOL. Thanks Sven.
The mere 7% earnings growth is pretty sobering considering all of the money printing, internet and globalization. Really shows the impact of money printing and deficit spending. Will the day of reckoning ever come?
Great explanation
This is irrelevant. Not saying it wont drop to 3000, but it wont be because it is expensive, but because of the actual reason why market move, which is global liquidity. Fundamentals on sp500 are much less relevant
Dr. Carlin… Would really love to get your take on Crocs (ticker: CROX), Grupo Aeroportuario del Centro (OMAB) & Wise plc.
I have full positions in all three of these equities and would love to get your unique value-centric critique of them. Thanks Sven
Perm bear making people missing out on gains
You are free to not watch his videos.
@@radosvalhe is free to express an opinion
@ I didn't say he couldn't.
Delusional perma bull thinking multiples will stay in the 30s and 40s in perpetuity...
@ you did lol and you got caught
Can you do VT, small cap value and AVDV
I'm ecstatic with the outcome of the election and the year-end market surge. Which hidden jewels in the upcoming bull run would you buy with a 100K right now? My goal is to position myself for a prosperous Q1 in 2025.
Bitcoin through 2025, then high yield ETFs through the bear market 26’-27’ that's my plan.
Index Funds & ETFs: 40-50%, Emerging Markets (e.g., VWO): 10-15%, Dividend Stocks: 10-20%, Growth Stocks/Small-Caps: 10-20%, REITs: 5-10% Remember to always work with a knowledgeable person in the financial market when starting out to avoid getting burnt.
“DCA" is the golden term but the key. My dollar portfolio i DCA with is made up of 30% PLTR, 25% NVDA, 15% VOO and over 30% in digital assets, thanks to my CFA. This strategy is what works for my spouse and I. We've made over 80% capital growth minus dividends. Q3 taxable divs this year was $18,388.
pls how can I reach this expert.
I'll be kind to leave just her name here ''Monica Lisa Payne''. She's a renowned figure in the financial sector with over two decades of experience. I'd suggest you research her further on the web.
I listen to Sven and I’m in sgov barely beating inflation. Oh i took a position in ADM, so I have 1% of capital in a stock. Lucky me
The exchange rate in the DEX is lagging hard
It almost sends 9 times more, I put out vldeo"
I'm new to BTC and l've been making losses trying to make profit myself in trading.. I thought trading demo account is just like trading the real market... Can anyone help me out or at least advise me on what to do?
As a beginner investor, it's essential for you to have a mentor to keep you accountable. Mrs. Mona Moayer gaines is my trade analyst, she has guided me to identify key market trends, pinpointed strategic entry points, and provided risk assessments, ensuring my trades decisions align with market dynamics for optimal returns.
YES!!! That's exactly her name (Mona Moayer) so many people have recommended highly about her and am just starting with her from Brisbane Australia
please l'm new here how can i contact her
she is mostly on Telegrams, using the user name👇
Moayer680✌️
Pessimism
Realism. Feeding the delusional hope that a goofy index will just rise and rise regardless of fundamentals is not investing.
Hello! Please analyze some companies from Romania (SNP, H2O, TLV)! Thanks!
Just swapped all of my last ETH and swapped it into XAI521K$. Already up a little bit. Unfortunately I have some other junk staked which won’t free up for a while. Still now I am on the train!
VOO is better than SPY by a small margin
Thanks for the update. I advise traders, especially beginners, to research the market before entering it. I have to say that trading is more rewarding than just owning. Big thanks to Henry mark who always keeps me updated. I am so glad I started his program.
This is interesting. I heard a lot about the same person not long ago, please how do I start?
@HenryMtrader✊💹
@HenryMtrader✊💹
@HenryMtrader✊🤙✍
An idiot with a spread sheet. I guess the whole market is wrong and only Sven is right. If you are so smart why don't you have a hedge fund and sell your stock picking to institutional investors instead of selling a course on you tube ?
Nothing screams "speculator" like somebody offended by data and rational arguments. What exactly do you expect? Multiples in the 30s and 40s in perpetuity?
With 6% earnings growth and a 20/25/30 multiple 10 years down the road, you are looking at a pathetic 3.5/5.5/7.5% return. Simple math.
The market can be wrong, meaning overvalued. The tens of bubbles in the history of capitalism aren't proof enough? Fool.
@ Future SP500 PE ratio is currently 24. The market is pricing 25% EPS growth for 2025. You can ask this scammer Sven to update his spread sheet and show us the results
@ Future SP500 PE ratio is currently 24. I'm not sure that PE of 24 means bubble. The only fool is you
@@aleksandarbalov9236 It doesn't matter if it is a bubble right now. You argued for trust in the wise market when history contradicts your point. It isn't just Sven, Warren Buffet, just as an example, seems to be hedging for a big correction too and he manages billions of dollars - your ad hominem doesn't work here.
It will happen with the tariff war started.
Thinking of swapping my USDT for XAI521K$. I believe XAI521K$ is the future
i like your sweather :D
Forget Shiba and Dogecoin. The next Bull runner gonna be XAI521K$
Great video buddy 🌈 XAI521K$ just keeps pumping!
I guess I am ultra risk lover. Even though I don't hold meme coins, I only hold XAI521K$ and ETH . Fingers crossed 🤞 🤞
This $XAI521K thing is going bananas 🚀
Ive stared buying $XAI521K ,and staked them.
I am bullish for $XAI521K and $NEXO only!!
$ONDO and $XAI521K will reign supreme in this cycle $XAI521K will move much faster than Solana. Youre welcome.