Market Barometer



If you wondered if the current market has become overheated, here is a
series of parameters that will help you make sense of the market.

some important parameters which will help you get an idea of market valuations. We have used the S&P BSE Sensex as the market indicator. The aggregate picture suggests that while the market has gone up significantly, it is still away from its historical highs across various parameters. 

Does it mean that you rush and buy stocks? No. 

Combine these indicators with thorough research on companies before you take the buy call




ARE WE IN A BUBBLE ZONE? 

The current situation does not tick off most of the indicators mentioned above, so we can safely say we’re not there just yet. Let’s look at it in terms of valuations: In June 2000, the Sensex P/E was close to 30x. In December 2007, it was close to 27x. Those were market peaks. Today it trades at 23x (as of March 16, 2017), so we are not yet in the bubble zone.

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