Valuations are irrelevant to stock returns over one-year time frames

Larry Swedroe unpacks a new paper that looks at tactical strategies based on price-earnings ratios. The conclusion will not shock regular readers of this sort of research: Over longer holding periods, the valuation you start with matters for forward returns. But one-year future returns have no link with current valuations at all. Here’s Swedroe, writing at ETF.com (emphasis mine): For example, for the period Decembe…

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