Equity Risk Premium Forum
The equity risk premium (ERP) is one of the great mysteries of finance. In this series inspired by and adapted from Revisiting the Equity Risk Premium from the CFA Institute Research Foundation, Rob Arnott, Cliff Asness, Roger G. Ibbotson, and Jeremy Siegel, among other leading financial luminaries, participate in a free-flowing discussion that explores the nature of this phenomenon.
"There’s one aspect of MMT that I have some sympathy for: the notion that what we spend money on is far more important than how we finance it." — Cliff Asness
"Has the hedge property overtaken the investment property of fixed-income assets?"
“How many here think the next 10-year equity returns are going to be below the long-run average? I certainly do. Is there anyone here who doesn’t?”
Does the equity risk premium (ERP) vary depending on the term structure? Does reversion to the mean dictate that it will decrease the longer the time horizon?
"If we thought of the equity premium as a fear premium," Rob Arnott says, "a lot of the so-called anomalies that we’ve talked about would not be anomalies at all."
Cliff Asness, Rob Arnott, Roger G. Ibbotson, and other luminaries explore the nature of bubbles and the momentum factor.