Another consideration is the “Buffett Indicator,” which tracks the ratio of market capitalization to GDP. Essentially, investing legend Warren Buffett notes that if the stock market is valued at a significantly higher rate than a country’s GDP, it could indicate that stock valuation is speculative, not actual. Currently, the indicator sits at about 224%, meaning the market could be significantly over-valued (4).In other words, Vanguard’s analysts believe that past performance may not be indicative of future ...