Pinho asks Silveira about using the Fed and Yardeni models to assess the value of the equity market. Silveira states:
Statement 3 The Fed model concludes that the market is undervalued when the market’s current earnings yield is greater than the 10-year Treasury bond yield.
Statement 4 The Yardeni model includes the consensus five-year earnings growth rate forecast for the market index.
Q. Which of Silveira’s statements concerning the Fed and Yardeni models is correct?
- Statement 3 only
- Statement 4 only
- Both Statement 3 and Statement 4
Solution
C is correct. The Fed model considers the equity market to be undervalued when the market’s current earnings yield is greater than the 10-year Treasury bond yield. The Yardeni model incorporates the consensus five-year earnings growth rate forecast for the market index, a variable missing in the Fed model.
为什么statement3也是对的？这两个模型是什么模型？
