With the inauguration ink still damp, investors might be trying to predict what Trump’s first 100 days will have in store. In a recent Bloomberg article, Ben Carlson of Ritzholtz Wealth Management writes, “Intelligent investors, however, understand that the long-term is the only time horizon that matters.”

One of the best ways to look ahead, according to Carlson, is by “setting reasonable expectations.” To do so, he writes, investors should lower their expectations for future stock market returns and, for bonds, look at current yield to best approximate long-term returns.

Valuations, Carlson says, are “as good a starting point as any” for predicting future stock market returns.  He refers to Shiller’s CAPE ratio (cyclically-adjusted price-earnings ratio) and how, historically, lower CAPE ratios correlated with higher future returns. He stresses, however, that the CAPE is “by no means foolproof. It’s always good to look at a wider range of valuations to get a better sense of the current landscape…around the globe.”

By those measures, Carlson points out, the U.S. is the “most expensive market across every valuation metric, but that makes sense given the huge outperformance over the past five years.”

Bond returns, Carlson points out, are “more or less governed by math” and he offers the following chart showing a “strong positive statistical relationship” between the starting yield for the benchmark 10-year U.S. Treasury note (going back to 1928) and 10-year annual returns: