“It has been an interesting year, watching the market recover from the current crisis—a little too fast for my taste,” writes Professor Aswath Damodaran in his latest e-alert, Damodaran Online. “The equity risk premium in the S&P 500, which was 6.43% at the start of the year, is now back down below 5%,” he says. Because the ERP is far more dynamic now than it ever has been, Aswath has monthly updates to website. For example, the equity risk premium at the end of October was 4.97%. Damodaran’s updated background on ERPs is available here.
Other updates: Damodaran also posted several papers to his site on "difficult to value" companies, including: 1) Cyclical and Commodity companies; 2) Distressed companies; and 3) Young and Start-up companies. “You are welcome to take whatever you can out of them,” he writes, with his typical generosity to the greater appraisal and academic community, “and your comments are always welcome.”
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