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Stock Strategist

What's the Market Really Worth?

An update on the valuations of major indexes.

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One way to get a read on the general attractiveness of stocks is to examine the valuations of major market indexes. To do so, we can tap into the work of Morningstar's 100-plus equity analysts.

With more than 2,000 stocks under coverage, our research spans much of the market. We cover all of the stocks included in the Dow Jones Industrial Average, and almost 98% of the assets in the S&P 500 Index. Thus, we can compute meaningful aggregate fair values of those familiar market barometers. Then we can compare the indexes' aggregate fair values with their current market values to gauge whether or not the market, as defined by those benchmarks, is cheap or dear.

Sonya Morris does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.