Equity Risk Premium

The extra return investors demand for holding equities over a risk-free government bond. Two schools: the historical average of realised excess returns over a long window, and the implied premium backed out of the current index level and expected cash flows. They can differ by several percentage points, which moves a valuation enormously, so state which one you used and why.

Where Equity Risk Premium comes up

How to Build a DCF Model: Build Order, Terminal Value and the Sanity ChecksA DCF is 70% terminal value and 100% assumptions. Build it so both can be defended.Read the guide — 12 min DCF Interview Questions: The Ones That Actually Come UpFrom "walk me through a DCF" to the follow-ups that catch people who only memorised the steps.Read the guide — 8 min

Keep reading

DCF interview questions guide

Related Valuation terms

Cost of Debt Country Risk Premium Cost of Equity Size Premium WACC Adjusted Beta

Go further than reading

The written material is free. These are the ways to get it applied to your own work.

CV Review by a Human

Written margin-note feedback on structure, impact bullets and ATS-readability. Reviewed by Suro, not an AI score.

$25 48h turnaround

Cover Letter Review by a Human

Line-by-line review of argument, tailoring and tone, with a rewritten opening as a worked example.

$50 48h turnaround

L3VLUP Pro

The subscription: personalised alerts, Apply Packs, every answer marked, full history and the whole research library.

$25 /month

Browse the full glossary — 340 finance recruiting and technical terms, in plain English.