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Despite war in Europe, the Dax has gained 12.5 percent in 2023, the S&P 500 16.3 percent and the Nasdaq 100 37.4 percent.

Great, right?

Retail investors are going heavily into stocks, instis out, because they expect bonds to achieve comparable returns with half the volatility over the next few years - just without the risk of stocks.

The 10-year Shiller P/E ("CAPE ratio") forecast calculates stock price-earnings ratios based not on annualized earnings assumptions, but on those of the past ten years, with the view adjusted for inflation. The result of the study, of the model predicts a stock return of 4% pa.

Now, one can believe that new technologies will cause new share price fireworks or that AI profits have already been distributed to Nvidia, Microsoft and Co.

This leads to a simple, clear result for institutional investors: Bonds offer the same returns as equities in the coming years - but with a significantly lower price risk. Thus, the portfolio share of bonds is currently being increased. If in the future, so in 4 years, the interest rates should also fall, because a then contained inflation allows this, the long-term bonds even increase in value.

We will see, based on this forecast, many funds merging or quitting because the overpriced fund system can no longer function as it did after the dotcom bubble burst.

Now this approach does not have to mean that we are all becoming or should become bond junkies. But it does mean that we need to take a closer look at what we are investing in according to a Selected Pearl approach.