DQYDJ Logo

Cyclically Adjusted PE Ratio (CAPE, or Shiller PE) Calculator for Any Timeframe

Written by:
PK

The Cyclically Adjusted Price to Earnings Ratio, also known as CAPE or the Shiller PE Ratio, is a measurement from Robert Shiller. It adjusts past company earnings by inflation to present a snapshot of stock market affordability at a given point in time.

This page contains a Shiller PE ratio which calculates the number for the last 10 years. It allows you to calculate a custom CAPE for any timeframe between 1 month and 50 years. Export your work to csv and take this data to a spreadsheet or stats program for further research.

(For the most recent date, see the S&P 500 Return Calculator)

CAPE Ratio Calculator

The Shiller PE

Robert Shiller first proposed a ten year timeframe for his CAPE ratio, targeting it towards the S&P 500 - the most well known American stock index. Subsequently, CAPE has been adapted for a number of other countries and indexes.

The Shiller PE is a valuation measure, much like its cousin the price to earnings ratio. However, the Shiller PE tries to work around the shortcomings of the current PE ratio – either inappropriate earnings or over or undervaluation. It does this by averaging results over a longer time frame.

This process means neither temporary dips in earnings (for example during the Great Recession) nor investor over-optimism (say, during the Tech Bubble) or over-pessimism will be inappropriately weighted on market valuations.

The Shiller PE or CAPE ratio is a measure of stock valuation.
The Shiller PE or CAPE ratio is a measure of stock valuation.

We first discussed the Shiller PE ratio in 2013, but suffice to say it's a long term valuation metric which, even when running 'hot', may take many years to find balance again. (if it ever finds balance.)

Additionally, as it is a ratio, CAPE suffers from a few effects inherent to... math.  Small numbers in the denominator increase its sensitivity -– prolonged periods of low or high earnings have large effects (unless, of course, those earnings are the 'new normal').

At a glance, you can't tell if prices or earnings are dominating – but the coarseness of the measurement is its strength. By removing your ability to justify a valuation, it forces you to consider what a high or a low number means.

Since all numbers are additionally adjusted by averaging over a timeframe, hopefully any temporary effects cancel out in the window examined.

In other words, it's not as clumsy or as random as other valuations like the 12 month P/E – it's a more elegant valuation measure for a more civilized investor.

Looking for something similar? It's comparable to the so-called Buffett Indicator, a ratio of stock market capitalization to GDP. Also look at Tobin's Q ratio, an estimate of stock market valuation versus replacement cost.

Sources of the Shiller PE and CAPE Ratio Calculator

Thank you to Robert Shiller, for providing his monthly data on the S&P 500. Please see his site for an explanation of the calculation of the ratio.

All data internal to the tool is monthly, while earnings data is quarterly.  Earnings data will lag the published dates – in those cases we 'carry forward' the last known earnings.

The methodology on the calculator itself is the same as listed on our other S&P 500 calculators - (technically, it even uses the exact same data file they are pointing to!).  That link will show the most recent month's notes.

Other Return and Tax Calculators You May Enjoy:

Don't Quit Your Day Job...

DQYDJ may be compensated by our advertising and affiliate partners if you make purchases through links. See our disclosures page for more information.
Sign Up For Emails
© 2009-2020 dqydj.com
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram