Question
Using historical risk premium from the following table over the 156 - 2020 period as your guide, what would be your estimate of the expected
Using historical risk premium from the following table over the 156 - 2020 period as your guide, what would be your estimate of the expected annual HPR on the stock portfolio if current risk-free rate is 3%
| T-Bills | T-Bonds | Stocks | |
| Average | 5.60% | 8.35% | 10.25% |
| Risk Premium | 2.77% | 4.67% | |
| Standard Deviation | 4.01% | 10.01% | 16.56% |
| Max | 18.21% | 44.41% | 56.41% |
| Min | 0% | -10.54% | -31.77% |
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Financial Economics
Authors: Frank J. Fabozzi, Edwin H. Neave, Guofu Zhou
1st Edition
0470596201, 9780470596203
