The cyclically adjusted price-to-earnings (CAPE) ratio is a valuation metric typically used to gauge whether entire stock market indexes are overvalued or undervalued. It was developed by Nobel-winning economist Robert Shiller during the dot-com bubble, so it is sometimes referred to as the Shiller P/E ratio.

And Berkshire’s record since Buffett took over speaks for itself: in the time since he took control through to the end of last year, Berkshire had outperformed the S&P 500 by more than 5mn percentage points. Buffett famously sat out the dotcom rush of the late 1990s, a move that was vindicated when it emerged that the boom was actually a bubble.