Session 5: Equity Risk Premiums

We started the class by completing the last loose ends on risk free rates, before turning our attention to equity risk premiums and what they purport to measures. We looked at historical risk premiums and their limits and then extended the discussion to estimate equity risk premiums for countries without much historical data. If you want to look at the historical returns on stocks, bills, bonds, real estate and gold in the United States, you can get the historical data at:
https://pages.stern.nyu.edu/~adamodar...
We will come back talk about alternatives to historical risk premiums in the coming sessions.
If you are interested in seeing what the equity risk premiums look like, by country, take a look at the spreadsheet at the link below:
https://pages.stern.nyu.edu/~adamodar...
On the riskfree rate front, try these two posts that I have on the topic, one to negative risk free rates and other to the Fed’s power (or lack of it) to set rates. Here are the links to those:
1. https://aswathdamodaran.blogspot.com/...
2. https://aswathdamodaran.blogspot.com/...

Start of the class test: https://pages.stern.nyu.edu/~adamodar...
Slides: https://pages.stern.nyu.edu/~adamodar...
Post class test: https://pages.stern.nyu.edu/~adamodar...
Post class test: https://pages.stern.nyu.edu/~adamodar...