The S&P 500's CAPE ratio has reached its second-highest ever, raising concerns among investors. The indicator points to an overheated market, reminiscent of the dot-com bubble of 2000. We analyze the reasons for the growth, possible consequences, and strategies for investors ...

... compared to the past. Given these factors, market professionals advise against relying solely on one indicator. It is far more effective to form an opinion about the state of the market based on a comprehensive set of metrics – from profitability ratios (P/E, CAPE) to debt indicators, margins, interest rate dynamics, and more. Paying attention to the “mosaic” of data provides a more rounded picture, while any single metric, even one as authoritative as the Buffett Indicator, cannot capture all nuances....