After the Easter eggs …

CAPE, the cyclically adjusted price-to-earnings ratio, remains a good valuation measure as it smoothes the earnings of the companies over the business cycle (10 years). On this measure, valuation of the US equity market is back to its peak reached after the financial crisis and almost as high as it was during the Internet bubble. The measure also confirms how cheap equities are outside of the US trading at 15 times normalized earnings compared to 35 times for the US market. After hunting for Easter eggs it is time to hunt for more investment opportunities outside of the US.