Equity Risk Premium
Pablo Fernandez University of Navarra — IESE Business School. Alberto Ortiz Pizarro University of Navarra, IESE Business School.
Isabel Fernandez AcIn University of Navarra. This paper contains the statistics of the Equity Premium or Market Risk Premium MRP used in for 71 countries. We got answers for more countries, but we only report the results for 71 countries with more than 8 answers. Most previous surveys have been interested in the Expected MRP, but this survey asks about the Required MRP.
The paper also contains the references used to justify the MRP, and comments from 46 persons. We sent a short email see exhibit 1 on April to more than 23, email addresses of finance and economic professors, analysts and managers of companies obtained from previous correspondence, papers and webs of companies and universities.
By May 4, , we had received 2, emails with 6, specific MRP used in Other persons answered that they do not use MRP for different reasons see table 1.
We would like to sincerely thank everyone who took the time to answer us. Some answers that do not provide a figure: Table 2 contains the statistics of the MRP used in for 71 countries.
Fernandez et al is an analysis of the answers for the USA; it also shows the evolution of the Market Risk Premium used for the USA in , , and according to previous surveys Fernandez et al, , a and b.
Fernandez et al b 3 is an analysis of the answers for Spain. Table 3 and figure 3 show the differences in Market Risk Premium used by the same person for 2 countries. Some respondents indicated which books, papers… they use as a reference to justify the MRP that they use.
GB - Market Risk Premia
The most cited references were: Table 4 compares some results of this survey with the results of , , , and Welch performed two surveys with finance professors in and , asking them what they thought the Expected MRP would be over the next 30 years. Johnson et al report the results of a survey of finance professors in North America done in March Graham and Harvey indicate that U.
CFOs reduced their average EEP from 4. In the survey, they report an average EEP of 3. They show that average EEP changes through time.
Equity Market Risk Premium | KPMG | NL
Ilmanen argues that surveys tend to be optimistic: Developed by ValueWalk Team. By VW Staff on May 9, 1: Share Tweet Post Flip.
Equity Premium expected equity premium historical equity premium market risk premium required equity premium.
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