MyPlanIQ submits:In a previous article we looked at Yale Professor Robert Shiller's Cyclically Adjusted Price Earning’ ratio (CAPE10). CAPE10 is defined as the ratio of price to the average of last 10 year trailing S&P 500 annual earnings.Complete Story »
MyPlanIQ submits: Yale Professor Robert Shiller has devised and maintained his Cyclically Adjusted Price Earning ratio (CAPE10) as an alternative to the P/E ratio to value the U.S. stock market.CAPE10 is defined as the ratio of price to the average of the last 10-year trailing S&P 500 annual earnings.
MyPlanIQ submits:Yale Professor Robert Shiller’s Cyclically Adjusted Price Earning Ratio (CAPE10) was reviewed October 2009. CAPE10 is defined as the ratio of price to the average of last 10 year trailing S&P 500 annual earnings.
Yale professor Robert Shiller was one of a relative handful of stock-market observers who warned that the bull market of the late 1990s was a colossal bubble in the making. Shiller's book, Irrational Exuberance, was published moments before the 2000 top, and it foretold much of the carnage that was to come.
By Ron Rowland:Barclays introduced a new exchange traded note (“ETN”) on October 11 under the ETN+ brand instead of the more familiar iPath brand. The Barclays ETN+ Shiller CAPE ETN (CAPE) will track the Shiller Barclays CAPE US Core Sector Index minus the 0.45% annual fee.
MyPlanIQ submits:In a previous article we looked at how the CAPE can be used as a signal to drive selection of assets. We created five regions based on the ratio of the current CAPE10 to the long term average CAPE10:
By Tom Lydon:
Adding to the growing number of enhanced or "intelligent" beta indexing strategies, Barclays, the bank behind the iPath suite of exchange traded notes, launched a new ETN based on Yale finance professor Robert Shiller's cyclically adjusted P/E ratio, or CAPE.
Matthew Crews:"Value-oriented" investors are often frustrated by the decade-long over-valuation of the S&P 500 (SPY) as measured by cyclically adjusted methods such as Professor Shiller's CAPE (Cyclically Adjusted Price-to-Earnings) framework. Given the bull market since 2009, maybe it is time to shelve the CAPE permanently? I'm sure most value-oriented investors are also pragmatic!