The Myth Of The Earnings Yield

The Myth Of The Earnings return A very lissome minority of firms distribute dividends. This adage has revolutionary implications. In the absence seizure of dividends, the foundation of most - if non all - of the financial theories we wage in order to dress the survey of sh ares, is falsified.

These theories rely on a few unsaid and explicit assumptions: (a) That the (fundamental) "value" of a share is closely agree (or even equal to) its commercialise (stock exchange or transaction) m unrivaledtary value (b) That price movements (and volatility) are generally random, though correlated to the (fundamental) "value" of the share (will always accommodate to to that "value" in the big term) (c) That this fundamental "value" responds to and reflects impudent data efficiently (old information is adequatey incorporated in it) Investors are supposed to discount the spud of all coming(prenominal) income from the share (using one of a myriad of potential rate - all heatedly disputed)....If you want to get a full essay, order it on our website: Ordercustompaper.com

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