Germany CAPE Ratio
Current Germany CAPE
As of August 2026 · ratio
Source: EWG — iShares MSCI Germany ETF
Rough estimate. This single-country CAPE is approximated by rolling the EWG 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 Germany cheap right now?
✓ Real · EWGOn 4 of 4 trailing multiples, Germany equities are priced below the all-world index (VT). These are current, fund-reported figures — not the estimated CAPE series charted below.
| Measure | Germany | World |
|---|---|---|
| P/E | 17.9 | 22.6 |
| P/B | 1.87 | 3.32 |
| P/S | 1.28 | 2.55 |
| Dividend yield | 1.94% | 1.59% |
| ROE (quality) | 10.4% | 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, Germany's estimated CAPE of 25.2 sits at the 68th percentile — historically expensive for Germany — above most of its own past readings.
Multiples as of August 2026.
- Historical average
- 24.5
- 365 months
- Historical median
- 23.6
- Percentile rank
- 68th percentile
- vs full history
- All-time range
- 12.9 – 48.2
- 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 Germany 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 Germany 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. Germany is Europe's largest economy and a genuine value-and-cyclical market, which makes it a good case for reading CAPE beside the live trailing multiples shown above. German equities trade below the all-world index on price-to-earnings, price-to-book and price-to-sales — a discount rooted in an index weighted toward carmakers, chemicals, industrials and insurers, businesses that are capital-heavy and highly geared to the global trade and manufacturing cycle (and, lately, to energy costs and Chinese demand). The offset is quality and cyclicality: Germany earns a lower, more volatile return on equity than the United States, so part of the discount compensates for earnings that swing with the cycle. The most useful read combines the CAPE percentile (how Germany 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 Germany ETF (EWG) 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 German stock market cheap right now?
On the fund-reported multiples above, German equities trade below the all-world index on price-to-earnings, price-to-book and price-to-sales, so they screen cheap. But the discount partly reflects the index's heavy weighting toward cyclical autos, chemicals and industrials and a return on equity below the US — read the low multiple alongside the CAPE percentile versus Germany's own history.
Why is the German market cheaper than the US?
Sector mix and cyclicality. The German index leans on carmakers, chemicals, industrials and insurers — capital-intensive, lower-margin businesses tied to the global manufacturing cycle — rather than the high-margin technology that lifts US valuations. It is also exposed to energy costs and Chinese demand, both of which have weighed on sentiment.
How does Germany compare to the rest of Europe and the world?
Germany typically trades at a discount to the all-world index and broadly in line with the wider European market, with a lower return on equity than the US. Its earnings are more cyclical, so its valuation tends to compress in downturns and re-rate in recoveries.
Is the Germany CAPE figure a measured ratio?
No. Only the US CAPE is a measured series (from Robert Shiller). Germany's CAPE here is an estimate built from a free ETF price proxy (EWG) 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.
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