equity premium in India
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equity premium in India

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Published by National Bureau of Economic Research in Cambridge, Mass .
Written in English

Subjects:

  • Rate of return -- India,
  • Stocks -- India

Book details:

Edition Notes

StatementRajnish Mehra.
SeriesNBER working paper series -- no. 12434., Working paper series (National Bureau of Economic Research) -- working paper no. 12434.
ContributionsNational Bureau of Economic Research.
The Physical Object
Pagination15 p. :
Number of Pages15
ID Numbers
Open LibraryOL17630682M
OCLC/WorldCa70962891

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The Equity Premium in India Rajnish Mehra. NBER Working Paper No. Issued in August NBER Program(s):Asset Pricing, Economic Fluctuations and Growth, International Finance and Macroeconomics. In this article we examine the Equity Premium in the Indian context and review the related by: The equity premiumis the return earned by a risky security, such as a stock, in excessof that earned by a risk free security, such as a Treasury Bill. It is a crucial input into financial decisions such as asset allocation, capital budgeting and planning for retirement. Historical data provide a wealth of evidence documenting that over long periods.   The book covers basics of the equity derivatives, trading strategies using equity futures and equity options, clearing, settlement and risk management as well as the regulatory environment in which the equity derivatives markets operate in India/5(22). The author of the book Prasenjit Paul, explains the scenario of the Indian stock market and the winning strategies used by him for consistent returns from the market. The book explains the basics of Investing in Stock in very simple and lucid terms. It also gives you a 2-min strategy to shorlist/reject stocks before detailed analysis.

Els UK chnpdf /9/25 pm Page: 2 Trim: in ×in Floats: Top/Bot TS: diacriTech, India 2 Chapter 1 •The Equity Premium: ABCs 1. INTRODUCTION The year saw the publication of Robert Lucas’ seminal paper “Asset Prices in.   Using the second approach yields an equity risk premium of %. Adding the country risk premium of % gives us a total risk premium of % for India. To this total premium we add the Indian risk free rate of % to yield a cost of equity of %. for India should be less than that for the US, which is counter-intuitive. Thus, while the survey method has a number of limitations, the applicability of the historical risk premium method in the Indian context is also limited. This brings to us to the implied premium method. Historical equity risk premiums Annualised daily standard deviation.   Your loss in such a case would be premium you have paid. However in India equity options and futures are currently cash settled and are not settled by delivery. Example. Current spot price per share = Rs Premium payable per share = Rs 10 ABC company has a lot size = 50 shares.

Franchise India is Asia's largest integrated franchise solution company since , is the absolute authority on Franchising, Licensing, Retailing and Real Estate. Franchise India was also the first company to introduce and develop the franchise market consulting in India and has been completely focused on Franchise Ecosystem for the past 16 years and will continue to do so. equity share in a business, the market return would be the return on the most suitable stock market. Significance of ERP The following is a brief snapshot of how ERP impacts various investment and policy decisions: • In corporate finance, to determine the costs of equity and capital for firms. Dissecting India’s Equity Risk Premium: How much to expect on your equity investments Download Brealey Myers in ‘Principles of Corporate Finance’ defines equity risk premium (ERP) as ‘the difference between the returns expected on the market and the interest rate on treasury bills’. The Equity Premium in India. By Rajnish Mehra. Get PDF ( KB) Abstract. In this article we examine the Equity Premium in the Indian context and review the related literature. The equity premium is the returned earned by a well-diversified stock portfolio in excess of that earned by a risk free security such as a Treasury Bill.