U.S. Equity Premium?

A subscriber requested measurement of a “premium” associated with U.S. stocks relative to those of other developed markets by looking at the difference in returns between the following two exchange-traded funds (ETF):

• SPDR S&P 500 (SPY)
• iShares MSCI EAFE Index Fund (EFA)

Using monthly dividend-adjusted closing prices for these ETFs during August 2001 (limited by EFA) through July 2026, we find that: (more…)