Global Valuation Updates!
Quarterly CAPE Ratio Updates
Finally we get to turn the page on a new year!
Below I thought we’d report the summary CAPEs with year end 2019, and current.
Median CAPE Ratio: 17, 17 (now)
25% cheapest: 12, 12
25% most expensive: 28, 28
Average of Foreign Developed: 22, 22
Average of Foreign Emerging 16, 15
It’s almost like 2020 didn’t happen…
We’ve mentioned this note in every update but bears repeating. We use the MSCI Investable Market Indices below, but MSCI also calculates their Standard Indices too. IMI includes more companies and in general is more representative of the entire market. It really makes no difference for any of the countries except the very smallest ones, such as Greece and Egypt. For both series the CAPE ratios are almost always near identical, with one glaring exception – again, Greece, which depending on the series you use has a CAPE ratio of -2 or 10.
So, this is one reason we have always used a valuation composite across the variables below. If one is giving a screwy result, or perhaps a market has a structural bias to one variable, we want to average it out. So, in this case Greece is cheapest on other metrics just not on CAPE.
| CAPE | CAPD | CAPCF | CAPB | Average Rank | Dev or Emerging | Real Drawdown % | |
| Czech Republic | 9.8 | 11.6 | 4.2 | 1.1 | 2 | E | -43.99 |
| Poland | 9.7 | 23.5 | 4.5 | 1 | 3 | E | -46.76 |
| Russia | 7.3 | 25.3 | 4.5 | 0.9 | 4 | E | -62.77 |
| Egypt | 9.9 | 23.1 | 5.4 | 1.1 | 4 | E | -72.03 |
| Spain | 13.6 | 18.3 | 6.1 | 1.2 | 6 | D | -28.99 |
| Chile | 12.1 | 24.5 | 6.7 | 1.1 | 7 | E | -47.32 |
| Turkey | 9 | 31.3 | 7 | 1.2 | 8 | E | -48.06 |
| Portugal | 18.5 | 20.1 | 5.3 | 1.3 | 9 | D | -52.98 |
| U.K. | 14 | 24.4 | 7.8 | 1.6 | 9 | D | -13.58 |
| Colombia | 13.1 | 25.3 | 8 | 1.1 | 9 | E | -30.68 |
| Singapore | 12.5 | 23.7 | 9.7 | 1.2 | 9 | D | -9.47 |
| Austria | 14 | 35.8 | 5.9 | 1 | 11 | D | -45.8 |
| Norway | 16.4 | 28.3 | 7.4 | 1.7 | 12 | D | -4.79 |
| Thailand | 14.8 | 30.3 | 8.9 | 1.9 | 12 | E | -24.16 |
| Greece | -2.3 | 20.9 | 3.8 | 0.4 | 12 | E | -96.57 |
| Italy | 19.8 | 30.3 | 5.6 | 1.1 | 13 | D | -38.42 |
| Malaysia | 15.8 | 30.8 | 10.2 | 1.6 | 14 | E | -3.17 |
| Hungary | 14.5 | 58.5 | 5.8 | 1.6 | 15 | E | -15.28 |
| South Africa | 16.5 | 30.2 | 10.8 | 2 | 16 | E | -18.45 |
| Indonesia | 15.7 | 37.1 | 10.3 | 2.4 | 16 | E | -19.15 |
| Hong Kong | 15 | 36.4 | 11.1 | 1.3 | 16 | D | -5.67 |
| Mexico | 17.6 | 44.3 | 8.4 | 2 | 18 | E | -18.44 |
| Australia | 18.9 | 25.9 | 12.7 | 2.1 | 18 | D | -5.71 |
| Germany | 18.7 | 41.1 | 9.2 | 1.9 | 19 | D | -2.65 |
| Philippines | 16.1 | 50.3 | 10.4 | 2 | 20 | E | -44.25 |
| Brazil | 19.6 | 35.5 | 11.4 | 2.1 | 20 | E | -2.5 |
| Peru | 15.8 | 40.9 | 15 | 2.3 | 20 | E | -23.98 |
| Belgium | 20.4 | 32.7 | 11.8 | 1.8 | 20 | D | -17.31 |
| Korea | 17.3 | 91.9 | 9.1 | 1.6 | 21 | D | -0.16 |
| France | 20.7 | 37.4 | 10.6 | 1.8 | 21 | D | -7.28 |
| Canada | 21.8 | 38.1 | 11.2 | 2 | 22 | D | -1 |
| Israel | 18.2 | 47.7 | 11.6 | 1.9 | 22 | D | -0.46 |
| Finland | 25.1 | 32.7 | 14.1 | 2.5 | 23 | D | -37.95 |
| China | 17.5 | 57.5 | 13.1 | 2.2 | 23 | E | 0 |
| Japan | 21.6 | 63.7 | 10.5 | 1.6 | 24 | D | -0.74 |
| Taiwan | 26.2 | 44 | 14.3 | 2.8 | 26 | E | 0 |
| Sweden | 22.9 | 44.7 | 16.4 | 3 | 27 | D | -0.86 |
| New Zealand | 31.8 | 41 | 17.2 | 3.2 | 28 | D | -1.7 |
| Switzerland | 26.2 | 42.7 | 19.3 | 3.3 | 28 | D | -1.93 |
| Netherlands | 27.9 | 58.8 | 17.3 | 2.8 | 30 | D | -0.49 |
| India | 25.7 | 95.7 | 16.4 | 3.4 | 30 | E | -12.12 |
| Ireland | 36.3 | 81.3 | 18.4 | 2.5 | 31 | D | -17.6 |
| U.S. | 34.6 | 85.1 | 20.9 | 4.6 | 32 | D | 0 |
| Denmark | 39.7 | 96 | 25.8 | 5.5 | 34 | D | -0.63 |
| US | Global | ||||||
| Communication Services | 21.3 | 15.6 | |||||
| Discretionary | 41.3 | 18.7 | |||||
| Energy | 9.9 | 31.6 | |||||
| Financials | 15.7 | 12.7 | |||||
| Health Care | 33.7 | 25.2 | |||||
| Industrials | 24.6 | 18.8 | |||||
| IT | 50.7 | 23.3 | |||||
| Materials | 27.7 | 18.7 | |||||
| Staples | 25.9 | 21.1 | |||||
| Utilities | 25.3 | 16.8 |
Good investing,
Meb Faber
theideafarm.com