Home › Topics › Risk Premium & Valuation
FR · Prime de risque et valorisation

Topic

Risk Premium & Valuation

An asset price is a numerical bet on growth, inflation and risk; valuation says which bet, not when it will fail. Shiller’s CAPE, the excess CAPE yield, the equity risk premium and the Buffett indicator each carry their own horizon, construction biases and critics, starting with Siegel’s case against CAPE. 145 years of Shiller data, real rates against CAPE since 1963 and daily S&P 500 series provide the historical scale.

36pieces
11in-depth analyses
11datasets
3quick reads

Where to start

Three reads, in order: the basics, the full mechanism, then what the data says.

01The basics Excess CAPE Yield: Shiller’s equity risk premium mechanics and the 10-year forward returns forecast How Shiller builds the Excess CAPE Yield (1/CAPE − real DGS10) to estimate the equity risk premium and forecast 10-year forward returns. AnalysisRead → 02The full mechanism Shiller CAPE ratio: why the cyclically adjusted P/E remains the academic reference for long-term equity valuation Why the Shiller CAPE, P/E adjusted to 10-year real earnings since 1881, remains the academic reference for long-term equity valuation. In-depth analysisRead → 03The evidence Real Interest Rates vs CAPE Ratio: US Stock Market Valuation Dataset (1963–2026) Research dataset mapping the relationship between US real interest rates and the Shiller CAPE ratio from 1963 to 2026. StudyRead →

Research and data

Our in-depth research and the downloadable series on the subject.

Dataset 14.59%Latest value · December 2025 S&P 500 Historical Annual Returns, 1928 to 2025 (Damodaran Data) See the data → Dataset 40.71Latest value · October 2026 Shiller PE Ratio (CAPE): S&P 500 Cyclically Adjusted Valuation Since 1881 See the data → StudyBuffett Indicator (Market Cap to GDP): US Corporate Equities Divided by GDP, Quarterly Since 1947 StudyDoes Tech Fall Harder in Bear Markets? US Tech vs the Market, 1971–2026

All analyses, by angle

Grouped by sub-topic rather than by date. Filter to get straight to the point.

Equity Market Valuation7

The sub-pillar →

Other angles19

Quick reads

Comparisons and common misconceptions: the essentials in a few minutes.

ComparisonBuybacks vs dividends: how shareholder returns differ ComparisonBitcoin vs Nasdaq: a correlation that keeps tightening MisconceptionsCommon mistakes about valuations and bubbles

Related topics

The subjects that most often intersect with this topic in our analyses.

Strategy & Asset Allocation45 pieces An allocation is judged over a full cycle, and every strategy has a bounded domain of validity. 3 in common → Yield Curve47 pieces The slope of the yield curve is the market’s compressed forecast for growth, inflation and central bank policy. 3 in common → Economic Cycles64 pieces A slowdown is not a recession, and quarterly headlines rarely reveal which phase the economy is in. 2 in common → Financial Instability24 pieces Financial stress is measurable: it often shows up in volatility and credit spreads before it reaches the headlines. 2 in common → Housing & Real Estate42 pieces Housing’s real cycle is a credit cycle: transaction volumes react to rates long before prices do. 2 in common → Macro-Financial Regimes24 pieces A hedge that worked in one inflation regime can become the risk in the next. 2 in common →
This topic also exists in French.Prime de risque et valorisation, 22 pieces →