Saturday, March 7, 2026

Why you’ll be able to’t trust the CAPE ratio

Why you’ll be able to’t trust the CAPE ratio


WWhat if I told you that the CAPE ratio only predicts 25% of the variation in 10-year returns for the S&P 500? Would you be so nervous about sky-high US valuations?

The stock market’s best-known valuation measure is currently at boiling point – the mercury has climbed into the 99th percentile of historical values.

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