Valuation – 12-Month Forward P/E Premium (Discount) of Growth vs. Value Should investors favor value vs. growth, as the premium of growth companies reached all-time highs? Image: Goldman Sachs Global Investment Research
S&P 500 Equity Risk Premium (ERP) Goldman Sachs forecasts the ERP will fall to 4.6% this year and 4.3% in 2022. Image: Goldman Sachs Global Investment Research
S&P 500 Equity Risk Premium (Using Breakevens) Today, the S&P 500 equity risk premium is much lower than it was in March 2020. Is a drawdown on the horizon? Image: Morgan Stanley Research
S&P 500 Equity Risk Premium – Consensus Bottoms Up Earnings Yield – 10-Year Treasury Yield As low real yields are driving investors to equities, could stocks continue to rise if the equity risk premium falls to 3%? Image: Morgan Stanley Research
Global Market Implied Equity Risk Premiums Equity risk premiums are still elevated. An improvement in growth expectations and falling uncertainty should compress ERPs. Image: Goldman Sachs Global Investment Research
U.S. Equity Risk Premium and VIX The U.S. equity risk premium remains above its long-term average, but the risk-adjusted return of equity has dropped below its long-term avearge this year. Image: Societe Generale Cross Asset Research/Global Asset Allocation
S&P 500 Equity Risk Premium Falling uncertainty and an improvement in growth expectations should compress the equity risk premium. Image: Goldman Sachs Global Investment Research
Implied Volatility Risk Premium The volatility risk premium has increased since May and remains high. Image: Deutsche Bank Asset Allocation
Valuation – 12-Month Forward P/E and Equity Risk Premium Despite the rise in the forward 12-month P/E ratio, the equity risk premium is in line with its long-term average. Image: Fidelity Investments
S&P 500 Equity Risk Premium and Yield Gap The S&P 500 equity risk premium remains high at 6% and above its historical average. Image: Goldman Sachs Global Investment Research