Business, Management and Accounting
4 years ago

New study reveals lower equity risk premium, impacting investment strategies.

1 view
SSRN Electronic Journal
Estimating the Equity Risk Premium Using Accounting Fundamentals
John F. O’Hanlon, Anthony Steele

Paper Summary

The study estimates the equity risk premium in the UK using accounting data and the Capital Asset Pricing Model. The results show that the premium is around 4% to 5%, suggesting it is lower than historical averages.

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