Risk
Economic vs. Equity Risk
When examining the impact of macroeconomic factors on the price of equity risk, research sometimes yields contradictory results. For instance, a solid correlation between high inflation and market […]
Archive
Category: [:en]WACC, CoC, Structure[:]
Risk
Transparency & Risk Premium
A study of 41 countries (Lau, Ng, and Zhang, 2011) shows that the price of equity risk is more stable in countries with high levels of transparency. Additionally, […]
Risk
Catastrophe Risk
Does the investment market consider the consideration of catastrophic risk in Equity Risk Premium? While the likelihood of a macroeconomic catastrophe is not high, it still occurs periodically. […]
Risk
Illusion of Risk
What does high-risk illusion and low resistance to good projects imply? #behavioralfinance The #NarrowFraming suggests that discussing investment decisions in isolation highlights the neglect of nonrational risks (Narrow […]
Risk
ERP Puzzle
In academic studies, the risk premium is usually estimated at 6-7%. However, what opinion should be expressed about the segmentation of time and calculation mechanisms, as many interpret […]
Risk
CFOs about ERP
From 2000 to 2017, a survey of 10,000 #CFOs was conducted regarding how they assess the risk premium of capital – that is, the difference between expected returns […]
Market Efficiency
The Small-Cap Premium
The small-cap premium (if such a thing exists) typically peaks in January… It’s unexpected, but still… Equity Risk Premiums (ERP): Determinants, Estimation, and Implications – The 2022 Edition […]