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My cost of equity assumption equals the 10-year Treasury yield plus 500 basis points. Studies show this spread approximates investor required rates of return over long periods. You can get Treasury yields going back to 1962 here: http://www.federalreserve.gov/releases/h15/data/b/tcm10y.txt.... But I always reserve the right to deviate from this rough cut estimate after studying the company, industry, competitive position, etc.


http://boards.fool.com/Message.asp?mid=23205260

MrT
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