IJEFSD
Vol. 6 No. 2 (2024): International Journal on Economics, Finance and Sustainable Development (IJEFSD

Impact of Market Risk Premium on Fair Share Value Exploration

Alasadi, Bushra Mohamed Sami (Unknown)



Article Info

Publish Date
30 Jun 2024

Abstract

This research explores the influence of the market risk premium on the fair value of shares traded on the Iraq Stock Exchange, employing the CAPM model to estimate the required rate of return. The CAPM model incorporates the risk-free rate (RF), market portfolio return (RM), and beta-processed risk premium. The study aims to quantify the impact of the risk premium on fair value, a critical component in determining the required rate of return. Statistical analysis, including correlation coefficients and regression analyses, was conducted to examine the relationships among the variables. The results indicate a direct one-to-one relationship between the risk premium and the intrinsic value of shares. This study fills a knowledge gap in understanding how market risk premiums affect share valuation, providing insights for investors and policymakers.

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Journal Info

Abbrev

IJEFSD

Publisher

Subject

Economics, Econometrics & Finance

Description

International Journal on Economics, Finance and Sustainable Development (IJEFSD) is an international, peer-reviewed, and scholarly journal aimed at being a platform for interdisciplinary researchers across the globe to develop and advance both theory and practice of economics and finance while ...