The venerable Barclays Bank of England published a report claiming that European shares are â??significantly underpricedâ?ť and could double within five years. In addition, the bankâ??s announcement claimed that shares could rise as much as 27 percent in 2014 alone, as they appear cheap relative to history. Specifically, price-to-book ratios have been good indicators of European stock returns over time. At todayâ??s 1.82 level, shares have generally doubled within five years of that ratio. Youâ??ll have to decide if this indicator is enough to get you to bet on Europe in 2014 and possibly during the next five years.
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