Don’t be deceived by a Forward P/E Ratio

Some charts are saying the Nasdaq 100 is at its cheapest in 4 years……based on its forward P/E Ratio.

Apparently, today, the ‘forward P/E’ is a reading of 19.

But 2 months ago, when that P/E Ratio was 20, it was a 4 year low.

But a month ago, that P/E Ratio was 19.5 and it was a 4 year low.

Yet, over the past 4 weeks, the Nasdaq 100 has declined 13%.

So, how’s your P/E Ratio theory looking?

See where I’m coming from?

The Nasdaq 100 may, then, be cheap when it falls a further 25% from today’s price of 27,000 points.

I’ll see you all at 20,250 points.

And even then, the Nasdaq 100 will only be at a 2 year low…..irrespective what the ‘forward P/E Ratio’ decides to be.

Funnily, pundits and politicians are suddenly concerned about the nation’s citizens pension and retirement account balances should the collective Mag 7 and AI cohort trade, unwind.

Perhaps, too much money is invested with money managers and funds who are neck-deep in the world’s most crowded trade?

Makes me think of the Gordon Gecko line, “Because they’re sheep — and sheep get slaughtered”.

November 9, 2026

rob@karriasset.com.au