PT  - JOURNAL ARTICLE
AU  - Charles P. Jones
AU  - Jack W. Wilson
TI  - Using the Supply-Side Approach to Understand and Estimate Equity Returns
AID  - 10.3905/jpm.2006.661378
DP  - 2006 Oct 31
TA  - The Journal of Portfolio Management
PG  - 76--85
VI  - 33
IP  - 1
4099  - https://pm-research.com/content/33/1/76.short
4100  - https://pm-research.com/content/33/1/76.full
AB  - A supply-side analysis of the average stock returns over 1926-2004 helps us see how components that include real earnings growth and the price-earnings ratio have contributed to the average total return. The long-run sustainable average equity return can be expressed as a benchmark expected equity return. An innovation is that investors can use a supply-side model as a disciplined framework for estimating average equity returns over much shorter periods than the 80-year sample analyzed.TOPICS: Quantitative methods, equity portfolio management, security analysis and valuation