Over the past few years, the USA S&P 500 The index achieved very much.

For example, in the previous half decade it increased by 84%. Compare it with FTSE 100 On this side of the pond. It increased by 42%during this period. I see it as a good performance – but it is only half as good as in the case of the S&P 500.

But exposure to investors regarding perspectives for the USA and the global economy meant that S&P recently introduced market correction. He regained some land, but it remains 14% below the place where he stood in February.

Can the situation worse from here?

The market will flourish, but it can’t last forever

I think the answer is like this. Despite the fall of S&P 500, it still looks high-priced to me. The price for profit (p/e) index is 26.

This is much above this type of P/E relationship, with which I would usually feel comfortable, looking for shares to buy for my portfolio.

We know from history that stock market markets are cyclical. They enter, come back and start the process again.

Given its quote, the cyclical nature of the markets and the high level of uncertainty as to the US global trade and economic prospects, I believe that the S&P 500 can face a significant disaster.

But what I don’t know (and nobody has) When.

It can be next week, it may be next year or in a decade. As the last few weeks showed us, markets can move in a dramatic and often unexpected way.

Here’s how I prepare

What does this mean in practice for my approach as an investor?

First of all, in the near future I do not plan to invest in the S&P 500 index tracking fund.

Secondly, I will continue to look for potential opportunities in the form of individual actions, which in my opinion are valued below their long -term value.

For example, I had an eye Nvidia (Nasdaq: NVDA) For a while. Given his spectacular results in the last few years, this cannot be a surprise.

I like the fact that Nvidia works on a huge, immense budget that still has significant development opportunities.

I also like his competitive position. It has many reserved technologies, a immense installed user base and production knowledge, which is both very sporadic and extremely tough to reproduce from scratch.

But the gallop of stock prices in recent years has made it too high-priced for my preferences. Recently, Nvidia actions had a tough time and understandable reasons. The rapidly changing principles of exports of tariffs and chips threaten a immense bite in sales and nvidia profits.

For this reason, I’m still not ready to buy. But if the S&P 500 disaster reduces the price enough, Nvidia is on my shopping list.