Cape Ratio - Is the Stock Market Overinvested?

The cape ratio is the price of a stock or an index divided by the earnings. Higher ratios can be attributed to over valued stocks or funds. Lower ratios more fairly valued. Average cape ratio is about 16 point nine two, that's average out the last 50 years. To day, it is still very, very high at 35, even after the ten % drop. So what that's telling you is the stock market in general can still be a little overvalued.