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发表于 2011-7-11 19:50
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cfahead Wrote:
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> If the question gives the equity repurchase yeild
> as negative.5% should that be added or taken away
> from the Dividend yield?
With regard to the confusion over whether what to do with the variable when the words 'repurchase yield' appear again, I just want to say that the meaning of repurchase yield is demonstrated on the CFAI text example below. I have started re-reading through all the examples provided by the text in the final week running up to the actual exam. This 'confusion' is a classic example of the importance of reading through all the examples in the text. The examples in the text are NOT written by the original authors of the books but inserted by CFAI themselves. So these examples are extremely important.
"The forecast dividend yield was 1.75 percent (somewhat above the then-current yield of 1.4 percent but below the historical mean of over 4 percent for 1926–2001). The repurchase yield was forecast to be 0.5 percent, down from the 1–2 percent rate of the 1990s, which was viewed as an unusual period. The expected income return was there- fore 1.75% + 0.5% = 2.25%."
(Level III Volume 3 Capital Market Expectations, Market Valuation, and Asset Allocation, 4th Edition. Pearson Learning Solutions p. 36). |
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