S&P 500 CAPE Ratio Analysis: Current Signals & Historical Patterns
- Unity Holdings
- Oct 1
- 1 min read
On September 23, 2025, during a speech in Providence, Rhode Island, Federal Reserve (“Fed”) Chairman Jerome Powell was asked about the Fed's view of financial market pricing. He replied, "By many measures, for example, equity prices are fairly highly valued."
A few questions jumped out to us immediately after Powell’s speech:
What did Chairman Powell mean by “fairly highly valued?”
Where does the current market valuation sit within S&P’s historical valuation range?
In this piece, we provide our analysis and insights.
Does overvaluation lead to underperformance or negative performance over the short, medium, and long run?
Does overvaluation mean that the market will collapse imminently?
