Please find the latest quarterly update from Jeremy Grantham's GMO. It holds lots of good market data. Inside they make an argument on how U.S. small cap is now incredibly overpriced and poised for a potential pull back.
"U.S. small cap stocks are now as expensive as we have ever seen them. Perhaps more surprising still is the deafening silence about this distinctly frothy group. Although the S&P 500 price index is still some way below its all-time high, U.S. small caps are within spitting distance of theirs: a high that was last reached with a booming global economy, strong employment, and a debt-driven consumption binge in full swing."
Jeremy Grantham has been arguing the virtues of large cap for a couple quarters now so its interesting to see this reiterated here and supported with some data.
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