10-15-2014, 06:49 AM
(10-14-2014, 01:52 PM)benjamen Wrote: 1) It considers the average historical rate of return for the market to be 11%, which is probably over optimistic
From Jan 1, 1871 to Dec 31, 2013 I get 10.75% avg return:
http://www.moneychimp.com/features/market_cagr.htm
(10-14-2014, 01:52 PM)benjamen Wrote: 2) It considers the current risk free rate to 3%, which is definitely over optimistic
Isn't the 30yr treasury rate the proxy to use for risk free rate? Currently 3.12%
http://www.treasury.gov/resource-center/...data=yield