The free, 11th annual update to ‘Equity Risk Premiums (ERP): Determinants, Estimation and Implications—The 2019 Edition’
is now available from Professor Aswath Damodaran
(New York University Stern School of Business). Damodaran continues to be a strong proponent of the use of the ex ante approach, or ‘implied’ ERPs, which are forward-looking estimates that are extracted by examining stock prices today and expected cash flows in the future (rather than the ex post approach using historical information). Damodaran’s implied ERPs are one of the options available in BVR’s Cost of Capital Professional
online platform for estimating the cost of equity.
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