You are a frontier market portfolio manager looking to make investments in Bhutan. The Bhutan Stock Exchange Index (BHEI
Posted: Mon Nov 15, 2021 5:15 pm
You are a frontier market portfolio manager looking to make
investments in Bhutan. The Bhutan Stock Exchange Index (BHEI)
trades at 1050 and paid a dividend yield of 3% last year. The
economy is expected to grow at 6%. The government runs a cronic
budget deficit so they have to pay a rate of 6.5% on long-term
bonds.
Estimate the implied risk premium for equities.
(Please show work. not on excel)
investments in Bhutan. The Bhutan Stock Exchange Index (BHEI)
trades at 1050 and paid a dividend yield of 3% last year. The
economy is expected to grow at 6%. The government runs a cronic
budget deficit so they have to pay a rate of 6.5% on long-term
bonds.
Estimate the implied risk premium for equities.
(Please show work. not on excel)