Bogleheads:Sandbox

Below is the corrected equation for Appendix 1 of Journal Simple Formulas to Implement Complex Withdrawal Strategies

The math rendering server times out and will give an error. It's commented out below for further debugging.



SSR = \frac{1}{1 + \frac{1}{(1+r_1)} + \frac{1}{(1+r_1)(1+r_2)} + \ldots + \frac{1}{(1+r_1)(1+r_2)\ldots(1+r_N-1)}} $$

The formula displays correctly when the rendering engine is changed, but it breaks existing formulas. I'll work on it. --LadyGeek 16:09, 4 February 2018 (EST)

PE10 forumula
"Trying to edit the P/E wiki page and the PE10 formula... Doesn't parse???  (Siamond, Feb 27th, 2018)" It's due to a 3rd party server timeout. I'll work on it.



\text{PE10} = \frac{\text{Stock Price}}{\text{average EPS over prior 10 years}} $$ --LadyGeek 21:10, 27 February 2018 (EST)

I changed the 3rd party server. Bogleheads:Extension test page has a problem rendering, but this may be a bug in the extension. --LadyGeek 22:29, 1 March 2018 (EST)

Shiller PE10
Robert Shiller has developed a stock valuation metric known as the "PE10"; alternatively called the CAPE (Cyclically Adjusted Price Earnings) ratio. It's P/E, but with the EPS (Earnings Per Share) averaged over the prior 10 years. Both terms (Price and Earnings) have to be expressed in real terms, i.e. adjusted for inflation.



\text{PE10} = \frac{\text{Stock Price}}{\text{average EPS over prior 10 years}} $$

Note that Prof. Shiller uses the same methodology as Standard & Poor's to compute the 'Price' and 'Earnings' components of the equation (i.e. simple aggregate).