search

SimplyWallSt / Company-Analysis-Model

Documentation behind the model used to analyse companies in Simply Wall St
Other
1.51k stars 410 forks source link

Equity Risk Premium. #26

Open zhiquan9 opened 4 years ago

zhiquan9 commented 4 years ago

I am referring to your notes on SimplyWallSt.

Pardon my ignorance. Please show how you arrive at 5.96 as the equity risk premium for the Amazon example shown. You have earlier indicated Equity Risk Premium is Cost of Equity 10% less Risk free rate.

filipposkat commented 3 years ago

I found that simplywallst uses an ERP calculated using historical data by Aswath Damodaran (Professor of Finance at NYU Stern School of Business), which can be found here: http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/ctryprem.html