2026 Running Against the Wind?

As we know anything can happen so this pessimistic stance is strictly to note the statistical phenomenon seen in the unpredictable world of the S and P. By most metrics the S and P has a Price to Earnings Ratio (P/E) above 24%. The significance of this is that when taking a lookback over the last 100 years this has preceded a 5 to 10 year stagnant or even bear market.

This may lead to a much more attractive bond market because if the return from stocks overall is flat or negative then that should lead to bonds yeilding a higher return! Active strategies may become more attractive also, as simply investing in the market as a whole won't be as advantageous as it once was. Investors and managers will have to adjust to trend following in order to take advantage of specific market gains.

Of course, none of this may take place and even the opposite may be true. There have been many times that a tried and true phenomenon has fallen short and the exact opposite effect happened. We will have to wait and see.