A note on the equity risk premium with help from TKer's newsletter archive 🔍
The shrinking ERP might signal something. It might signal nothing. 🤷🏻♂️
Long-term interest rates have been on the rise. The yield on the 30-year Treasury bond just hit its highest level since 2007.
When interest rates climb to multi-year highs, it means you’ll soon hear more market pundits pontificate about the equity risk premium (ERP), which can be roughly defined as the additional return investors expect from stocks relative to bonds.
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