Editor's Note: Below is a brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more about the Early Look.
Surly “valuation” experts have been shorting the wrong sector (and style factors) in 2017 (Tech).
Looking back at the last 30 years of NTM P/E (price to earnings) ratios, Utilities and Consumer Staples are easily the 2 most EXPENSIVE US Equity Sectors relative to where they’ve been priced historically (in the 97-99th percentiles of historical readings vs. Tech in the 65th percentile).
Were bears short these two sectors last week? They should have been. If they were they crushed it...
A) Utilities (XLU) were -2.8% in an up tape to +9.6% YTD
B) Consumer Staples (XLP) stocks were down -2.4% to +4.3% YTD
