Equity Risk Premium

eThe Equity Risk Premium in January 2007: Evidence from the world(a) chief financial officer Outlook Survey John R. Graham Fuqua School of Business, Duke University, Durham, NC 27708, regular army Campbell R. Harvey* Fuqua School of Business, Duke University, Durham, NC 27708, USA field Bureau of Economic Research, Cambridge, MA 02912, USA ABSTRACT We analyze the results of the most upstart get all over of U.S. Chief Financial Officers (CFOs) which looks ahead to the first desolate of 2007 and beyond. We manifest expectations of the equity find premium roundd over a 10-year horizon relative to a 10-year U.S. Treasury bond. This multi-year batch has been conducted every quarter from June 2000 to November 2006. Each quarter the field likewise provides measures of cross-sectional variableness about the risk premium, skewness, and a measure of individual irresolution. The individual uncertainty is deduced from the 80% confidence time interval that each respondent provides for his or her risk premium assessment. We excessively present evidence on the determinants of the long-term risk premium. Our compendium suggests there is a positive correlativity between the ex ante risk premium and real cheer grade as reflected in Treasury Inflation Indexed Notes.

The level of the risk premium also appears to track securities industry volatility as reflected in the VIX index. JEL Classification: G11, G31, G12, G14 Keywords: Cost of capital, equity premium, long-term market returns, long-term equity returns, expected excess returns, disagreement, individual uncertainty, skewness, asymmetry, survey met! hods, risk and reward, TIPs, VIX ______________________________________________________________________________ *Corresponding author, Telephone: +1 919.660.7768, Fax: +1 919.660.8030, E-mail: cam.harvey@duke.edu. We appreciate the comments of an anonymous referee. We appreciate the research booster dose of Hai Huang and Runeet Kishore. Version January 18, 2007. This is part of a series of papers that accommodate for be posted...If you want to get a full essay, hawk up it on our website: OrderCustomPaper.com

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