AAPL 151.96 -2.68999 -1.7394034FB 196.64 +0.990005 0.50600845GOOG 99.995 -8.045 -7.4463143MSFT 269.8 +2.23999 0.83719176NVDA 225.01 +3.28 1.4792761WBA 36.625 -0.115002 -0.3130149ZNGA 8.18 -0.17 -2.035929

Market Risk Premium

Historical average realized returns

Data

Year	S&P 500	T-Bond	Dividend	Dividend %	T-Bond Return	T-Bill Return	S&P 500 Return
1927	17.66	3.17%	0.62	3.51%
1928	24.35	3.45%	1.05	4.31%	0.84%	3.08%	43.83%
1929	21.45	3.36%	0.88	4.10%	4.20%	3.16%	-8.30%
1930	15.34	3.22%	0.72	4.69%	4.54%	4.55%	-25.13%
1931	8.12	3.93%	0.50	6.16%	-2.56%	2.31%	-43.81%
1932	6.92	3.35%	0.50	7.23%	8.79%	1.07%	-8.62%
1933	9.97	3.53%	0.41	4.11%	1.86%	0.96%	50.00%
1934	9.5	3.01%	0.35	3.68%	7.96%	0.32%	-1.20%
1935	13.43	2.84%	0.51	3.80%	4.47%	0.18%	46.74%
1936	17.18	2.59%	0.54	3.14%	5.02%	0.17%	31.94%
1937	10.55	2.73%	0.56	5.31%	1.38%	0.30%	-35.33%
1938	13.14	2.56%	0.50	3.81%	4.21%	0.08%	29.29%
1939	12.46	2.35%	0.54	4.33%	4.41%	0.04%	-1.07%
1940	10.58	2.01%	0.55	5.20%	5.40%	0.03%	-10.67%
1941	8.69	2.47%	0.54	6.21%	-2.02%	0.08%	-12.76%
1942	9.77	2.49%	0.59	6.04%	2.29%	0.34%	19.22%
1943	11.67	2.49%	0.55	4.71%	2.49%	0.38%	25.08%
1944	13.28	2.48%	0.61	4.59%	2.58%	0.38%	19.02%
1945	17.36	2.33%	0.68	3.92%	3.80%	0.38%	35.84%
1946	15.3	2.24%	0.60	3.92%	3.13%	0.38%	-8.41%
1947	15.3	2.39%	0.80	5.23%	0.92%	0.57%	5.23%
1948	15.2	2.44%	0.97	6.38%	1.95%	1.02%	5.69%
1949	16.79	2.19%	1.19	7.09%	4.66%	1.10%	18.29%
1950	20.43	2.39%	1.53	7.49%	0.43%	1.17%	30.79%
1951	23.77	2.70%	1.50	6.31%	-0.30%	1.48%	23.69%
1952	26.57	2.75%	1.51	5.68%	2.27%	1.67%	18.13%
1953	24.81	2.59%	1.44	5.80%	4.14%	1.89%	-1.20%
1954	35.98	2.51%	1.87	5.20%	3.29%	0.96%	52.56%
1955	45.48	2.96%	2.23	4.90%	-1.34%	1.66%	32.60%
1956	46.67	3.59%	2.19	4.69%	-2.26%	2.56%	7.43%
1957	39.99	3.21%	1.80	4.50%	6.80%	3.23%	-10.46%
1958	55.21	3.86%	2.26	4.09%	-2.10%	1.78%	43.71%
1959	59.89	4.69%	1.98	3.31%	-2.65%	3.26%	12.06%
1960	58.11	3.84%	1.98	3.41%	11.64%	3.05%	0.33%
1961	71.55	4.06%	2.04	2.85%	2.06%	2.27%	26.64%
1962	63.1	3.86%	2.15	3.41%	5.69%	2.78%	-8.81%
1963	75.02	4.13%	2.35	3.13%	1.68%	3.11%	22.61%
1964	84.75	4.18%	2.58	3.04%	3.73%	3.51%	16.41%
1965	92.43	4.62%	2.83	3.06%	0.72%	3.90%	12.40%
1966	80.33	4.84%	2.88	3.59%	2.91%	4.84%	-9.98%
1967	96.47	5.70%	2.98	3.09%	-1.58%	4.33%	23.80%
1968	103.86	6.03%	3.04	2.93%	3.27%	5.26%	10.81%
1969	92.06	7.65%	3.24	3.52%	-5.01%	6.56%	-8.24%
1970	92.15	6.39%	3.19	3.46%	16.75%	6.69%	3.56%
1971	102.09	5.93%	3.16	3.10%	9.79%	4.54%	14.22%
1972	118.05	6.36%	3.19	2.70%	2.82%	3.95%	18.76%
1973	97.55	6.74%	3.61	3.70%	3.66%	6.73%	-14.31%
1974	68.56	7.43%	3.72	5.43%	1.99%	7.78%	-25.90%
1975	90.19	8.00%	3.73	4.14%	3.61%	5.99%	36.99%
1976	107.46	6.87%	4.22	3.93%	15.98%	4.97%	23.83%
1977	95.1	7.69%	4.86	5.11%	1.29%	5.13%	-6.98%
1978	96.11	9.01%	5.18	5.39%	-0.78%	6.93%	6.51%
1979	107.94	10.39%	5.97	5.53%	0.67%	9.94%	18.52%
1980	135.76	12.84%	6.44	4.74%	-2.99%	11.22%	31.74%
1981	122.55	13.72%	6.83	5.57%	8.20%	14.30%	-4.70%
1982	140.64	10.54%	6.93	4.93%	32.81%	11.01%	20.42%
1983	164.93	11.83%	7.12	4.32%	3.20%	8.45%	22.33%
1984	167.24	11.50%	7.83	4.68%	13.73%	9.61%	6.15%
1985	211.28	9.26%	8.20	3.88%	25.71%	7.49%	31.24%
1986	242.17	7.11%	8.19	3.38%	24.28%	6.04%	18.50%
1987	247.08	8.99%	9.17	3.71%	-4.96%	5.72%	5.81%
1988	277.72	9.11%	10.22	3.68%	8.22%	6.45%	16.54%
1989	353.4	7.84%	11.73	3.32%	17.69%	8.11%	31.47%
1990	330.22	8.08%	12.35	3.74%	6.24%	7.55%	-3.06%
1991	417.09	7.09%	12.97	3.11%	15.00%	5.61%	30.23%
1992	435.71	6.77%	12.64	2.90%	9.36%	3.41%	7.49%
1993	466.45	5.77%	12.69	2.72%	14.21%	2.98%	9.97%
1994	459.27	7.81%	13.36	2.91%	-8.04%	3.99%	1.32%
1995	615.93	5.71%	14.17	2.30%	23.48%	5.52%	37.20%
1996	740.74	6.30%	14.89	2.01%	1.43%	5.02%	22.68%
1997	970.43	5.81%	15.52	1.60%	9.94%	5.05%	33.10%
1998	1229.23	4.65%	16.20	1.32%	14.92%	4.73%	28.34%
1999	1469.25	6.44%	16.71	1.14%	-8.25%	4.51%	20.89%
2000	1320.28	5.11%	16.27	1.23%	16.66%	5.76%	-9.03%
2001	1148.09	5.05%	15.74	1.37%	5.57%	3.67%	-11.85%
2002	879.82	3.82%	16.08	1.83%	15.12%	1.66%	-21.97%
2003	1111.91	4.25%	17.39	1.56%	0.38%	1.03%	28.36%
2004	1211.92	4.22%	19.44	1.60%	4.49%	1.23%	10.74%
2005	1248.29	4.39%	22.22	1.78%	2.87%	3.01%	4.83%
2006	1418.3	4.70%	24.88	1.75%	1.96%	4.68%	15.61%
2007	1468.36	4.02%	27.73	1.89%	10.21%	4.64%	5.48%
2008	903.25	2.21%	28.39	3.14%	20.10%	1.59%	-36.55%
2009	1115.1	3.84%	22.41	2.01%	-11.12%	0.14%	25.94%
2010	1257.64	3.29%	22.73	1.81%	8.46%	0.13%	14.82%
2011	1257.6	1.88%	26.43	2.10%	16.04%	0.03%	2.10%
2012	1426.19	1.76%	31.25	2.19%	2.97%	0.05%	15.89%
2013	1848.36	3.04%	36.28	1.96%	-9.14%	0.07%	32.15%
2014	2058.9	2.17%	39.44	1.92%	10.79%	0.05%	13.52%
2015	2043.9	2.27%	43.00	2.10%	1.28%	0.21%	1.36%
2016	2238.83	2.45%	45.03	2.01%	0.69%	0.51%	11.74%

Arithmetic Average

Year	S&P 500 Return	T-Bill Return	T-Bond Return
1928-2016	11.42%	3.46%	5.18%
1967-2016	11.45%	4.88%	7.08%
2007-2016	8.64%	0.74%	5.03%

Geometric Average

Year	S&P 500 Return	T-Bill Return	T-Bond Return
1928-2016	9.53%	3.38%	4.91%
1967-2016	10.09%	4.83%	6.66%
2007-2016	6.88%	0.73%	4.58%

Risk Premium Arithmetic Average

Year	Risk Premium T-Bill Return	Risk Premium T-Bond Return
1928-2016	7.96%	6.24%
1967-2016	6.57%	4.37%
2007-2016	7.90%	3.62%

Risk Premium Geometric Average

Year	Risk Premium T-Bill Return	Risk Premium T-Bond Return
1928-2016	6.15%	4.62%
1967-2016	5.25%	3.42%
2007-2016	6.15%	2.30%

Financial Modeling Prep is a new concept that informs you about stock markets information (news, currencies and stock prices). We always strive to give you the best and most updated information. We also gives you free financial modeling methodology through our academy. Most investment banking firms follow our guidelines to get discounted cash flow statement of companies to see if they are undervalued, overvalued or simply at par value. You can find all financial models and valuation techniques that is used in corporate finance to get companies intrinsic valuation. Most private equity firm use financial modeling for decision making when it comes to hold, buy or sell a particular stock.