Historical Returns

Discounted Cash Flow Valuation: The Inputs

What about historical premiums for other markets? l Historical data for markets outside the United States tends to be sketch and unreliable. l Ibbotson, for instance, estimates the following premiums for major markets from 1970-1990 Country Period Stocks Bonds Risk Premium Australia 1970-90 9.60% 7.35% 2.25% Canada 1970-90 10.50% 7.41% 3.09%

  Flows, Sachs, Historical, Cash flow