With the S&P 500 at Historically High Levels, Consider This Alternate Way to Invest in the Index

The S&P 500 is undoubtedly the stock market's most important index because it tracks the performance of around 500 of America's largest and most influential companies. After a disappointing 2022 when the index declined by over 19%, it has been on a strong bull run, up more than 78% since the start of 2023.This recent run is great news for investors who've been along for the ride, but it has also had another cautionary effect: The S&P 500 is now trading at historically high levels. One key metric that shows this is the Shiller price-to-earnings (P/E) ratio, sometimes known as the CAPE ratio.The Shiller P/E ratio examines the S&P 500's inflation-adjusted earnings per share (EPS) over the previous 10 years, aiming to provide insight into the index's valuation without being influenced by one-off booms or slumps that could be misleading. The current Shiller P/E ratio is above 40 -- a mark only hit three times in over 150 years.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool