CAPE / Shiller PE Ratio

This indicator lets you quickly calculate and visualize the CAPE ratio for any stock on TradingView, helping you make informed decisions about the sustainability of current price levels. With its clear presentation and intuitive setup, you can compare historical CAPE levels and identify potential opportunities for long-term investments or avoid overvalued markets.
Advantages of the CAPE Ratio:
- Long-Term Focus: Smooth earnings over ten years, reducing the impact of short-term volatility.
- Inflation-Adjusted: Provides a more precise, inflation-adjusted valuation measure over time.
- Historical Comparison: Allows for benchmarking against long-term historical averages.
- Market Sentiment Indicator: Can highlight overvalued or undervalued markets for long-term investors.
- Reduces Noise: Filters out short-term earnings fluctuations, offering a more stable view.
Disadvantages of the CAPE Ratio:
- Ignores Recent Earnings: Misses short-term earnings changes, which can affect current valuations.
- Outdated Data: Relies on old earnings data that may not reflect recent company performance.
- Less Effective for Growth Stocks: May undervalue high-growth stocks focused on future earnings.
- Sector Limitations: Works best for broad markets, less so for fast-changing industries.
- Debated Predictive Power: It’s unreliable for timing short-term market movements.
In short, the CAPE ratio is excellent for long-term valuation but has limitations for short-term or growth-focused investing.
Disclaimer
Please remember that past performance may not be indicative of future results.
Due to various factors, including changing market conditions, the strategy may no longer perform as well as in historical backtesting.
This post and the script don’t provide any financial advice.
Script open-source
In pieno spirito TradingView, il creatore di questo script lo ha reso open-source, in modo che i trader possano esaminarlo e verificarne la funzionalità. Complimenti all'autore! Sebbene sia possibile utilizzarlo gratuitamente, ricorda che la ripubblicazione del codice è soggetta al nostro Regolamento.
Per un accesso rapido a un grafico, aggiungi questo script ai tuoi preferiti: per saperne di più clicca qui.
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Declinazione di responsabilità
Script open-source
In pieno spirito TradingView, il creatore di questo script lo ha reso open-source, in modo che i trader possano esaminarlo e verificarne la funzionalità. Complimenti all'autore! Sebbene sia possibile utilizzarlo gratuitamente, ricorda che la ripubblicazione del codice è soggetta al nostro Regolamento.
Per un accesso rapido a un grafico, aggiungi questo script ai tuoi preferiti: per saperne di più clicca qui.
💼 Hire Us: qntly.com/pine
📞 Book a call: qntly.com/cons
📰 qntly.com/news
𝕏: qntly.com/x
📩 qntly.com/tel