There are two different stock market realities, says Schwab’s chief investment strategist, Liz Ann Sonders: There’s the perception of the market’s strength and the truth about what has happened to the bulk of the companies in the S&P 500 and Nasdaq this year.

Sonders warned advisors about these trends at Schwab’s Impact conference on Tuesday.

“In fact, there has been lots of chatter about how resilient the market has been this year, but a look under the hood is revealing,” said Sonders. “More than 90% of the S&P and Nasdaq has had at least a 10% drawdown this year, with the average being minus 18% for the S&P and—get this—a whopping minus 38% for the Nasdaq.”

These are called rotational corrections, when different parts of the market rise and fall. They are certainly preferred over swift corrections across the entire index. Sonders warned, however, that while “this benign scenario could persist … I wouldn’t be surprised if indexes at some point play some catch-down.”

While most advisors recognize that the market is not cheap at this point, the surge in price-earnings denominators has helped bring multiples down from last year’s surge, she said.

“These days, I’m often asked if the market is in a bubble. And bubbles, we know, form when enough people shift their investment thesis from ‘Will I make money from holding this security or asset class and receiving its profits?’ to ‘Will I be able to find someone to buy this security or asset class at a higher price?’” Well that certainly applies to many of the speculation-fueled pockets, perhaps not yet to the broader market,” Sonders said.

So, what’s an investor to do? “First, keep a sharp eye on the correlation between bond yields and stock prices,” Sonders said.

During the inflationary period that persisted for three decades starting in the 1960s, yields and stock prices moved inversely. But in the years since then, amid the bursting of the housing and tech bubbles, yields and stock prices have moved together, she said.

Recently the correlation inverted for a short span. A more sustained inverse correlation could send a message that we’ve entered a secular period of higher inflation.

She said that given the extreme volatility, it might be time for investors to focus more on factors like quality rather than on traditional sectors and style buckets.

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