UPDATED AS AT: 9 APRIL 2026
The risk free rate of return in a market represents how much the investors expect to get in return for investing in a default-free instrument from that market. In most markets, government bonds are considered default-free instruments (they are seen as .
The equity risk premium (ERP) is the extra return (premium) that the investors expect to get in return for investing in risky instruments in that market, on top of the risk free rate.
Diversiview uses the following RF instruments, risk-free rates of return and ERP (equity risk premium) values to calculate the expected return (CAPM) for individual securities, as well as other indicators such as Portfolio Alpha and Portfolio Sharpe Ratio.
| Market / Country | RF Instrument | RF value (instrument yield) | ERP for country |
| ASX / AU | Australia Bond 10 Year Yield | 4.94% | 4.77% |
| NASDAQ & NYSE / US | 10 Year US Treasury Yield | 4.30% | 5.03% |
| BSE & NSE / IN + MUTUAL FUNDS / IN | India 10-Year Government Bond | 6.90% | 7.98% |
| HKEX / HK | Hong Kong 10-Year Government Bond | 2.897% | 5.65% |
| LSE / UK | UK Gilt 10 Year Yield | 4.70% | 5.65% |
| DFM / UAE | US dollar-denominated 10-year UAE Bond | 4.857% | 5.49% |
Updates:
RF are updated at least once a month (usually weekly), from the respective instruments listed above. ERP values are updated twice a year, or more often if new values become available.
Values:
RF values are yields of the instruments listed above, sourced from public governments websites.
The equity risk premium (ERP) reflects fundamental judgments we make about how much risk we see in an economy/market and what price we attach to that risk.
Country ERP values are based on the Implied ERP for US as calculated by Prof Aswath Damodaran from the Stern School of Business at New York University.
Implied ERP for US on 1 April, 2026=4.77% (Trailing 12 month cash yield)
If you have any questions about the above information, please contact the team at contact@lensellgroup.com.
