Canada CAPE Ratio
Current Canada CAPE
As of August 2026 · ratio
Source: EWC — iShares MSCI Canada ETF
Rough estimate. This single-country CAPE is approximated by rolling the EWC ETF price from a recent anchor — free data has no per-country 10-year earnings — so treat it as a directional gauge, not a measured CAPE. It is bounded and is not used in the headline Global CAPE. See the methodology.
By Dominic Roe · Data Engineer & Business Intelligence Developer Updated August 2026
Is Canada cheap right now?
✓ Real · EWCOn 2 of 4 trailing multiples, Canada equities are priced below the all-world index (VT). These are current, fund-reported figures — not the estimated CAPE series charted below.
| Measure | Canada | World |
|---|---|---|
| P/E | 20.5 | 22.6 |
| P/B | 2.82 | 3.32 |
| P/S | 2.78 | 2.55 |
| Dividend yield | 1.27% | 1.59% |
| ROE (quality) | 13.8% | 14.7% |
Green = cheaper than the world index on that measure. ROE is shown as context, not cheapness: a lower return on equity means part of a cheap multiple may be deserved rather than a bargain.
Against its own history, Canada's estimated CAPE of 30.1 sits at the 100th percentile — historically expensive for Canada — above most of its own past readings.
Multiples as of August 2026.
- Historical average
- 19.2
- 365 months
- Historical median
- 18.8
- Percentile rank
- 100th percentile
- vs full history
- All-time range
- 12.4 – 30.4
- Last updated
- August 2026
- since April 1996
Understanding this metric
What is it?
The Cyclically Adjusted Price-to-Earnings ratio (CAPE), also called the Shiller P/E or PE10, measures how expensive Canada equities are relative to their inflation-adjusted earnings over the prior ten years. By averaging a decade of real earnings it smooths out the booms and busts of the business cycle, giving a steadier read on valuation than a one-year P/E.
How is it calculated?
CAPE is computed by dividing the real (inflation-adjusted) price of the Canada equity market by the average of its real earnings over the trailing ten years. Both price and earnings are expressed in today's currency using a consumer price index, so a CAPE of 25 means investors are paying 25 times a smoothed, inflation-adjusted measure of annual earnings.
Historical interpretation
Historically a high CAPE has been associated with lower subsequent long-run real returns, and a low CAPE with higher returns. It is a valuation gauge, not a market-timing signal: rich valuations can persist or grow richer for years. Compare today's reading to the metric's own history — its average, median and percentile rank — rather than to a single "fair value" number. Canada is a banks-and-resources market, which shapes both its valuation and how to read it. Canadian equities trade at a modest discount to the all-world index on price-to-earnings and price-to-book — less a deep bargain than the structural result of an index dominated by large banks, pipelines and energy producers, miners and railways, businesses that carry heavy assets and trade on lower multiples. Its return on equity sits close to the world average, so the discount is shallower than in more cyclical value markets. The most useful read combines the CAPE percentile (how Canada is priced against its OWN history) with those cross-market multiples before concluding the market is cheap.
Limitations
CAPE has well-known limitations. Accounting standards, payout policies, profit margins, interest rates and sector composition all change over decades, which can shift the "normal" range upward or downward. The ten-year window still includes unusual periods (such as a deep recession) that distort earnings. CAPE says little about the next year and should be combined with other metrics rather than used in isolation. This series is an ESTIMATE, not a measured CAPE. Free data does not include long-history, per-country 10-year real earnings, so it is built by anchoring a recent CAPE level and rolling it through history using the inflation-adjusted price of the iShares MSCI Canada ETF (EWC) with a steady real-earnings trend removed. History only extends as far back as the country ETF (typically the late 1990s/2000s). Treat it as a directional valuation gauge. See the methodology documentation for sources and assumptions.
Frequently asked questions
Is the Canadian stock market cheap right now?
Modestly. On the multiples above, Canada trades at a small discount to the all-world index on price-to-earnings and price-to-book, though it is dearer on price-to-sales — more a structural tilt from its banks-and-energy mix than a deep bargain. Read it against Canada's own CAPE history rather than expecting a large discount.
Why is the Canadian market valued the way it is?
Concentration. A handful of large banks, pipeline and energy producers, miners and railways dominate the index — asset-heavy, lower-multiple businesses — so Canada trades below the technology-rich US, but with a return on equity close to the world average that keeps the discount shallow.
How exposed is Canada to commodities?
Heavily. Energy and materials are a large share of the index, so Canadian valuations and earnings move with oil, gas and metals prices alongside the health of the big banks. That cyclicality is part of why the market trades at a discount to the US.
Is the Canada CAPE figure a measured ratio?
No. Only the US CAPE is a measured series (from Robert Shiller). Canada's CAPE here is an estimate built from a free ETF price proxy (EWC) and a recent anchor, so treat it as directional. The trailing P/E, P/B, P/S and dividend yield shown above are real, current figures reported by the country's tracker fund.
Embed or download this chart
Free to use with attribution. The embedded image updates automatically as the data does.