Stock | Price | Price Change |
---|---|---|
TSX:DTOL | C$ 8.29 | 13.72% |
TSX:TSAT | C$ 11.33 | 10.54% |
TSX:WPRT | C$ 10.67 | 6.81% |
TSXV:BCF | C$ 8.89 | 5.46% |
NEOE:MMED | C$ 5.07 | 5.19% |
TSX:KEI | C$ 5.36 | -5.47% |
TSX:MX | C$ 58.56 | -4.81% |
TSX:HPS.A | C$ 45.02 | -4.68% |
TSX:APS | C$ 7.60 | -4.64% |
TSX:CMG | C$ 6.59 | -4.35% |
Country: Canada (updated daily) check out Global Overview for detailed methodology.
According to the original Buffet Indicator, the Stock Market is Fair valued.
Ratio of total market cap over GDP: Recent 20 Year Maximum - 184.77%; Recent 20 Year Minimum - 70.26%; current - 138.97%
Expected future annual return: 4.8%
Based on the newly introduced total market cap over GDP plus Total Assets of Central Bank ratio, the Stock Market is Fair valued.
Ratio of total market cap over GDP plus Total Assets of Central Bank: Recent 20 Year Maximum - 150.32%; Recent 20 Year Minimum - 67.03%; current - 122.83%
Modified expected future annual return: 5.5%
ETF Used for dividend yield: EWC (Yield=2.17%)
Market Index used: TSXSP
Current Annual GDP: $2,083 billion US dollars or 2,785 in billions of national currency (GDP in Local Current Prices Annual Growth=3.83%)
Current Total Asset of Central Bank: $274 billion US dollars or 366 in billions of national currency
Data since year 1980
Based on these historical valuations, we have divided market valuation into five zones:
Ratio = Total Market Cap / GDP | Valuation |
---|---|
Ratio ≤ 88% | Significantly Undervalued |
88% < Ratio ≤ 114% | Modestly Undervalued |
114% < Ratio ≤ 139% | Fair Valued |
139% < Ratio ≤ 164% | Modestly Overvalued |
Ratio > 164% | Significantly Overvalued |
Where are we today (2023-06-09)? | Ratio = 138.97%, Fair valued |
Based on these modified historical valuations, we have divided market valuation into five zones:
Ratio = Total Market Cap / (GDP + Total Assets of Central Bank) | Valuation |
---|---|
Ratio ≤ 83% | Significantly Undervalued |
83% < Ratio ≤ 106% | Modestly Undervalued |
106% < Ratio ≤ 130% | Fair Valued |
130% < Ratio ≤ 153% | Modestly Overvalued |
Ratio > 153% | Significantly Overvalued |
Where are we today (2023-06-09)? | Ratio = 122.83%, Fair valued |
From the equation presented on the U.S. market valuation page,
Investment Return (%) = Dividend Yield (%) + Business Growth (%) + (Re/Rb)(1/T)-1
We can compute the predicted and actual returns of the Canada stock market over a given time period, T. In the calculation, we set T to equal eight years, the approximate length of a full economic cycle. The calculated results are presented in the chart below.
The Predicted Return line indicates the expected, or predicted annualized return for the next eight years if the current TMC / GDP ratio reverts to its recent 20 years mean of 126.21%.
The Modified Predicted Return line indicates the expected, or predicted annualized return for the next eight years if the current TMC / (GDP + Total Assets of Central Bank) ratio reverts to its recent 20 years mean of 117.98%.
The Actual Return line indicates the actual, annualized return of the Canada stock market over eight years. We use “TSXSP” to do the actual return calculation. We can see the calculations largely predicted the trend in the stock market as the actual return line is closely parallel to the two predicted return lines.
Under the original buffett indicator, the stock market of Canada is expected to return 4.8% a year for the coming years. This is from the contribution of economic growth in local current prices: 3.83%, Dividend Yield: 2.17% and valuation reverse to the mean -1.2%.
Under the modified model, the contribution of economic growth and dividend yield stays the same while the valuation reverse to mean changes to -0.5%. Consequently, the stock market of Canada is expected to return 5.5% a year.
This is the projected return and the modified projected return of the stock market in Canada relative to other countries. Click on the country on the right sidebar to check out the details for each country.