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What is the highest rate?
Premium Investment Grade is the highest credit rating.Prime Investment Grade: No Risk of DefaultRating AgencyRatingS&PAAAMoodyAaaFitchAAA
What is the highest credit rating?
Premium Investment Grade is the highest credit rating.Prime Investment Grade: No Risk of DefaultRating AgencyRatingS&PAAAMoodyAaaFitchAAA
What is the credit rating?
Premium Investment Grade is the highest credit rating.Prime Investment Grade: No Risk of DefaultRating AgencyRatingS&PAAAMoodyAaaFitchAAA
The market risk premium is measured by?
The market risk premium is measured by the market return less risk-free rate. You can calculate the market risk premium as market risk premium is equal to the expected return of the market minus the risk-free rate.
What is the premium added as a compensation for the risk that an investor will not get paid in full?
maturity risk premium
What is risk premium?
Risk premium is the compensation investors expect to earn in return for taking risks.
The risk premium is likely to be highest for?
A short sale. Because when you short sell a stock, its value can raise an unlimited amount and you will be liable to cover it eventually.
What is the required return for a security is15 percent and the risk-free rateis6 percent the risk premium is?
The risk premium for a security is calculated by subtracting the risk-free rate from the required return. In this case, with a required return of 15 percent and a risk-free rate of 6 percent, the risk premium is 15% - 6% = 9%. Thus, the risk premium is 9 percent.
If the market risk premium were to increase everything else beign equal the value of common stock would do what?
Value of the common stock will go down.As market becomes riskier market participants adjust expected risk premium and start to demand higher returns, consequently they begin to sell stocks as they do not satisfy their newly adjusted expected risk premium. As a result stock price goes down.
What is the current market risk premium?
Banks are currently using 8% market risk premium. Data as of Feb, 2013.
What does it mean when one has market risk premium?
When one has market risk premium he/she is willing to take an financial risk. The risk premium is how much value stocks should return over a risk-free investment. Stocks are considered a higher financial risk (and possible a faster gain) opposed to, for instance, bonds.
What is the premium that reflects the risk associated with changes in interest rates for l long-term security?
Maturity Risk Premium (MPR)
