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50% stock market crash 'wouldn't surprise me'; This is the biggest risk today - Ted Oakley

Kitco News

The biggest risk facing investors right now is the unsustainable stock market valuations that will eventually mean revert, said Ted Oakley, founder and partner of Oxbow Advisors.

“From this level, if you look at your standard deviations of valuations relative to where the market is, and you just go back to an average of where it should be, that’s probably right now, somewhere between a 40% and 50% break,” Oakley told David Lin, anchor for Kitco News.

Oakley noted that while a correction of that magnitude is not necessarily imminent, but a large correction is likely within the next two years.

If investors have ample liquidity to capitalize on such a correction, “you could really make a lot of money,” he said.

“The highest risk is in the stock market. I think real estate is risky too. We’re in a period that we call it ‘everything is speculative,’ and that’s true, almost everything is speculative. Private businesses are selling for speculative prices, but the markets are selling for prices that actually have never existed before,” he said.

For more information on investing methodologies, and how to pick assets for an inheritance, watch the video above.

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.