Cyclically adjusted price/earnings (CAPE) ratios plotted against subsequent 12-year annualised index returns. The scatter plot and forecast use returns from 1928 onwards; the CAPE series itself goes back further where data allow. The red line on each scatter plot is a linear fit used for the Forecasts page. US data comes from Robert Shiller’s S&P Composite series. Other markets use CAPE derived from index price and worldperatio trailing P/E: earnings are backed out as price ÷ P/E, then CAPE is price divided by the 10-year average of those earnings (no inflation adjustment).