Is the Vanguard Russell 2000 Index Fund ETF a Buy Now?

Does the broad market's steep valuation have you leery of buying anything right now? If so, you're not alone. The S&P 500's (SNPINDEX: ^GSPC) trailing price-to-earnings ratio of just under 27 (and by some measures it's more than 30) is higher than it's been in years. Even if the advent of artificial intelligence (AI) allows most companies to grow into their stocks' lofty valuations, it may not happen soon enough to sidestep a correction in the meantime. We could even slip into a full-blown bear market if the feared AI bubble ends up popping.If you dig deeper though, you will find that most stocks are not outrageously overpriced at this time. A small handful of huge technology companies operating in the artificial intelligence sector are skewing the S&P 500's valuation sharply higher. If you take these companies out of the equation, the S&P 500's trailing valuation is actually more or less in line with long-term norms. Meanwhile, the rest of the market is quietly priced below its long-term average valuations, making new investments in the Vanguard S&P Small-Cap 600 ETF (NYSEMKT: VIOO) or the Vanguard Russell 2000 ETF (NASDAQ: VTWO) particularly attractive right now.It's an often-forgotten detail. But just because it's used as a broad market barometer doesn't mean the S&P 500 represents the entirety of the stock market.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool