The S&P 500 just flashed a rare warning signal last seen in dot-com bubble. Crashproof your wealth now
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The CAPE ratio is best used as a risk management tool for assessing portfolio diversification rather than as a market-timing tool.
60% confidenceThe S&P 500 CAPE ratio has recently climbed to roughly 41.33, a level reached only twice in the past century.
60% confidenceSince 1871, Shiller's CAPE ratio has exceeded 24 on only six occasions, with the first five occurring immediately prior to major market downturns.
60% confidenceHigher CAPE ratios have historically been associated with lower long-term stock market returns.
60% confidenceA market crash or recession is not necessarily imminent despite the elevated CAPE ratio.
60% confidenceThe CAPE ratio has not been a reliable indicator of when exactly a market downturn will begin.
60% confidenceA current CAPE ratio of 41.33 means investors are paying roughly $41.33 for every $1 of inflation-adjusted earnings generated over the previous 10 years.
60% confidence