Cost of capital

Analysis of the ever-changing price of money

Stock prices rose last fortnight. The S&P 500 index of big American companies climbed 0.7% to 4,739. But corporate earnings dropped a little. Earnings per share for the index fell 60 cents to $211.60. That’s left the market a bit overvalued. At the current price, it offers an 8.8% expected return, still some of the highest returns on offer in over a dec…