Equities declined around the world in 2018, and valuations fell sharply. The risks are clearly significant—but have stocks fallen too far? With earnings still expected to advance this year, we think selective investors can find attractive entry points.

Reality can be subjective. For many investors in stocks, last year’s pain was real, as returns fell sharply due to the escalating US-China trade war, growing concerns about monetary policy tightening and fears of a global economic slowdown, all of which weighed on the earnings outlook.