I was playing around with SWRs when the market is priced high and came across an interesting result. Attached is a graph of 30 year SWRs versus Schiller’s PACE (P/E10 – an indicator of how costly stock market prices are) for the S&P 500. The P/E10 and SWR are both calculated at the beginning of retirement for retirement years since 1928. The data is for a diversified portfolio of 60% equities and 40% short term treasuries. A few days ago the the P/E10 was 28.85, giving a SWR of 4.2% with a 50% chance of survival, or a SWR of 3.45% for an 85% chance of survival. Curiously, a more conservative portfolio of 40% equities and 60% treasuries gives SWRs of 4.05%(50% survival) and 3.25% (85% survival), so it is not safer.