The S&P 500 index’s internal indicators signal a top may be in the making. After two years of returns in excess of 20%, the index trades at a pricey forward price/earnings ratio of 22x. Renewed inflation concerns could be a catalyst for a serious correction. We remain fully invested but contemplate reducing risk at some point in the year. While the consensus among Wall Street strategists is that the S&P will rise 12% this year, studies show their accuracy as a group is less than 50%. As a group, they’ve also never predicted a down year, while in fact one in four years has historically had a negative return.