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Tag: CAPE Ratio
The CAPE ratio or the Cyclically Adjusted Price to Earnings Ratio was introduced by Yale University, Professor Robert Shiller. The CAPE ratio is also known as Shiller PE multiple. The ratio is computed by dividing a company’s share price by the last ten years’ average inflation-adjusted earnings. It’s a popular valuation metric that smoothes out the fluctuations in corporate earnings in a different period in a business cycle.