Stocks are not cheap based on any empirically proven valuation metric. The S&P 500 P/E ratio is over 25—not the highest level ever recorded, but certainly on the high end of the historical scale. And the average P/E ratio of the stocks in the tech-heavy NASDAQ 100 is 37, according to last Friday’s Wall Street Journal.
There are only two ways for the P/E ratio to decline toward more normalized levels. One isn’t happening, and the other isn’t pretty.
Here’s what to do now to prepare yourself and your portfolio…
This post originally appeared at Investors Alley.