What is the market risk premium now?
The average market risk premium in the United States increased slightly to 5.6 percent in 2022. This suggests that investors demand a slightly lower return for investments in that country, in exchange for the risk they are exposed to. This premium has hovered between 5.3 and 5.7 percent since 2011.
What is the risk premium 2022?
The expected risk premium for the Global Market Index ticked slightly higher in March to an annualized 5.8% pace, fractionally above last month's estimate. The forecast reflects the projected long-run return over the risk-free rate, according to a risk-based model (detailed below).
What is the S&P market risk premium?
The market risk premium reflects the additional return required by investors in excess of the risk-free rate. The ERP is essential for the calculation of discount rates and derived from the CAPM.