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The Story of the Week: The Schiller P/E Hits 30

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The Story of the Week: The Schiller P/E Hits 30

Introduction

This article was posted on Saturday, 18:33, UTC.

Party Like It’s 1929 (or 1999)   Long-Term Chart Shiller P/E Ratio of US Stocks The Cyclically Adjusted P/E ratio (CAPE) is one of the most reliable valuation metrics out there.  It was designed by Robert Shiller, writer of the must-read book Irrational Exuberance, hence it is also called the Shiller P/E. The Shiller P/E It is widely used to judge the overall valuation “environment” of a stock market, with a great track record. It’s based on the traditional Price/Earnings ratio, but instead of one year’s earnings, it is calculated by using the 10-year average of earnings. This metric has…

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Mate Cser

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

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