Global Valuation Updates!

For new subscribers, you may not be aware that we’ll share the global stock market valuations each quarter. You can view all prior quarterly updates here.

Quarterly CAPE Ratio Updates

Median CAPE Ratio: 15
25% cheapest: 10
25% most expensive: 25

Average of Foreign Developed: 19
Average of Foreign Emerging: 14

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.

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 cheap on other metrics just not on CAPE.

Since we get asked this question a lot, in addition to The Idea Farm, here are a few great free resources for global stock market valuations…

1. Research Affiliates
2. Barclays
3. Professor Shiller
4. Professors French & Fama
5. Professor Damodaran

A few great paid choices include Global Financial Data and Ned Davis Research. Let us know if we’re missing any!

MSCI Investable Market Indices 

CAPE CAPD CAPCF CAPB Average Rank Dev or Emerging Real Drawdown %
Egypt 6.7 18.4 3.9 0.8 2 E -79.68
Poland 8.1 20.1 3.6 0.8 3 E -58.67
Colombia 11.5 22.5 6.5 0.9 7 E -38.8
Turkey 7.7 27.6 6 1 8 E -52.73
Singapore 11.3 20 8.9 1 10 D -22.88
Spain 14.1 18.8 6.1 1.1 10 D -33.54
Chile 12.2 23.4 6.6 1.1 11 E -47.43
Austria 12.1 33 5.4 1 12 D -46.92
Brazil 12.2 21.2 7.1 1.4 12 E -32.24
Czech Republic 14.3 17.3 6.1 1.5 12 E -20.78
Hungary 9.4 42.6 3.6 1.1 12 E -42.41
Italy 17.3 27.6 5.1 1 13 D -43.4
Malaysia 13.3 24.7 8.4 1.3 15 E -17.23
Germany 13.9 30.4 6.7 1.4 16 D -29.13
U.K. 14.6 24.3 7.9 1.6 17 D -9.29
Peru 11.8 27.2 11.1 1.4 17 E -48.24
Greece -2.4 30.8 4.6 0.5 18 E -96.67
Portugal 23.9 23 6 1.5 18 D -49.13
Korea 12.5 61.2 6.4 1.1 19 D -32.83
Hong Kong 14 31.6 9.9 1.1 20 D -19.32
China 11.9 39.8 9.3 1.4 20 E -41.9
Norway 18.1 29.2 7.8 1.7 23 D -10.76
Thailand 15.5 30.1 8.9 1.8 23 E -21.71
Philippines 14 44.1 8.8 1.6 24 E -51.07
South Africa 15.4 29 9.8 1.9 24 E -17.79
Belgium 17.1 28.7 10.4 1.6 24 D -25.35
Australia 17.9 24.2 11.8 2 26 D -14.25
Mexico 16.8 40.1 7.9 1.9 26 E -17.44
Indonesia 15.9 36.3 9.8 2.3 28 E -18.02
France 20.8 36.8 10.3 1.7 28 D -21.27
Japan 19.6 57.4 10 1.5 29 D -12.12
New Zealand 21.7 28.6 12.1 2.1 30 D -30.27
Canada 20.9 36.2 10.9 1.9 30 D -17.18
Israel 17.5 49.1 11.1 1.7 30 D -20.12
Finland 22.1 28.2 12.4 2.2 30 D -45.22
Sweden 17.5 37.3 12.7 2.4 33 D -30.85
Taiwan 21.8 39 12.5 2.5 35 E -22.76
Ireland 22.5 59.9 13.2 1.8 36 D -34.62
Switzerland 23.6 38.5 17 3 37 D -18.81
Netherlands 23.6 51.2 15 2.4 38 D -35.1
U.S. 28 67.9 17.2 3.8 41 D -25.6
India 28.2 98.5 17.8 3.5 42 E -20.18
Denmark 34.8 84.3 23.4 5.3 43 D -17.54
Russia E -100

 

Good investing,

The Idea Farm Team

 

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