RUSSELL 2000 IS 433% OVERVALUED...
RUSSELL 2000 IS 433% OVERVALUED...
The stocks on the Russell 2000 are actually 433% OVERVALUED based on the math of their PE being 80 when the normal PE is 15. To get the overvaluation percentage you divide 80 by 15 which equals 5.33 which equates to 533%, and less the 100% of actual value that means that those stocks are overvalued by 433%.. The amount those stocks need to fall from their current PE valuations of 80 to the normal PE valuation is 81.25% based on taking 80 and subtracting 15 and getting 65 and then dividing 65 by 80 which equals .8125 which equates to 81.25%. Math never lies and is always absolute. Folks should try using it more often...