The average market risk premium in the United States remained at *** percent in 2025. This suggests that the returns that investors expected for their investrments remained the same as the previous year in that country, in exchange for the risk they are exposed to. This premium has hovered between *** and *** percent since 2011. What causes country-specific risk? Risk to investments come from two main sources. First, inflation causes an asset’s price to decrease in real terms. A 100 U.S. dollar investment with three percent inflation is only worth ** U.S. dollars after one year. Investors are also interested in risks of project failure or non-performing loans. The unique U.S. context Analysts have historically considered the United States Treasury to be risk-free. This view has been shifting, but many advisors continue to use treasury yield rates as a risk-free rate. Given the fact that U.S. government securities are available at a variety of terms, this gives investment managers a range of tools for predicting future market developments.

Market risk premiums (MRP) measure the expected return on investment an investor looks to make. For potential investors looking to add to their portfolio, the perfect scenario for a risk-based investment would be a high rate of return with as small a risk as possible. There are three main concepts to MRPs, including required market risk premiums, historical market risk premiums, and expected market risk premiums. United Kingdom shows little return for risk Europe-wide, Finland had one of the lowest MRP alongside Poland and Germany. Ukraine had average risk premiums of *** percent in 2025. Having a lower market risk premium may seem bad, but for countries such as the UK and Germany where rates have been consistent for several years, it is because the market is stable as an environment for investment. Risk-free rates Risk-free rates are closely associated with market risk premiums and measure the rate of return on an investment with no risk. As there is no risk associated, the rate of return is lower than that of an MRP. Average risk-free rates across Europe are relatively low.

Graph and download economic data for Real Risk Premium (TENEXPCHAREARISPRE) from Jan 1982 to Oct 2025 about premium, real, and USA.

Market risk premiums (MRP) measure the expected return on investment an investor looks to make. For potential investors looking to add to their portfolio, the perfect scenario for a risk-based investment would be a high rate of return with as small a risk as possible. There are three main concepts to MRP’s, including required market risk premiums, historical market risk premiums and expected market risk premiums. In 2025, average market risk premiums in Germany stood at *** percent. MRP in Europe As of 2025, Germany had one of the ****** average market risk premiums in Europe. At the same time, market risk premiums in Russia were more than ***** as high due to the risk of investment involved. Risk free rates Risk free rates are closely associated to market risk premiums and measure the rate of return on an investment with no risk. As there is no risk associated, the rate of return is lower than that of an MRP. Average risk free rates across Europe were relatively low in 2025. The risk free rate of investment in Germany was less than three percent as of 2025.

Split into three categories (required, historical, and expected), market risk premiums measure the rate of return investors expect on an investment over the risk that investment holds. In Europe, average market risk premiums (MRP) sit between four and 12 percent. Greece sees hike in MRP Although it has a relatively high market risk premium, Greece has seen its rates significantly decrease since 2020. Greece also saw a *** percent return rate on risk-free investments. The same correlation can be seen with Europe’s less risky countries for investment. With Germany seeing *** percent market risk premiums and *** percent risk-free returns in Europe. Required, historical, and expected Separating the three types of market risk premiums is straightforward. Required MRPs differ between investors, as approaches to investment change and measure the rate of return needed for an investment to be made. Expected premiums look at the rate of return and what they are calculated to come out as, while historical MRPs look back over a period at the average rate of return that investors previously got in the past.

Market risk premiums (MRP) measure the expected return on investment an investor looks to make. For potential investors looking to add to their portfolio, the perfect scenario for a risk-based investment would be a high rate of return with as small a risk as possible. There are ***** main concepts to MRP’s, including required market risk premiums, historical market risk premiums and expected market risk premiums. In 2023, average market risk premiums in Turkey increased from the previous year. Turkey has second-highest MRP in Europe In 2023, Turkey had the third-highest average market risk premium rates in Europe. That year, right above Turkey, Russia and Ukraine recorded the highest MRP rates in Europe. At the other end of the scale was Netherlands and Switzerland, whose market risk premiums averaged almost quarter of those seen in Ukraine. Risk-free rates Risk-free rates are closely associated to market risk premiums and measure the rate of return on an investment with no risk. As there is no risk associated, the rate of return is lower than that of an MRP. Average risk-free rates across Europe were relatively low in 2023, with exceptions. The risk-free rate of investment in Turkey in 2023 was **** percent.

Replication data for manuscript "The Historical and Expected Equity Risk Premium in Spain: A Long-Run View, 1900-2020". We present revised estimates of the historical (ex post) equity risk premium and an original estimate of the expected (ex ante) premium for the Madrid stock market over a period of 120 years. The results are based on a new equity index, the H-IBEX (1900-1987), built on high-quality monthly data hand-collected from primary sources and methodologically aligned with the modern Spanish index, IBEX35. We also reconstructed an original weighted index of government bonds (1900-1987) which can be smoothly connected with recent data. Data include original series for equities, bonds and bills for the Madrid Stock Exchange from 1900 to 1987, at monthly and annual frequency, spliced with more recent data on equities (IBEX35) and bonds, to cover the period until 2020. Documentation includes three Excel files (monthly series, annual series and summary of annual data) and one Eviews13 file with main regressions.

Market risk premiums (MRP) measure the expected return on investment an investor looks to make. For potential investors looking to add to their portfolio, the perfect scenario for a risk-based investment would be a high rate of return with as small a risk as possible. There are * main concepts to MRPs, including required market risk premiums, historical market risk premiums and expected market risk premiums. In 2025, average market risk premiums in Poland decreased from the previous year to reach *** percent. Greece and Ukraine with the highest MRP in Europe In 2023, Poland was relatively well-placed for average market risk premiums in Europe, compared to other countries. Countries with the highest MRP, and therefore of the highest investment risk included Ukraine and Russia. Poland's risk premiums reached *** percent. Ukraine risk premiums averaged at ** percent in 2023. Risk-free rates Risk-free rates are closely associated to market risk premiums and measure the rate of return on an investment with no risk. As there is no risk associated, the rate of return is lower than that of an MRP. Average risk-free rates across Europe (except for Turkey and Ukraine) were relatively low in 2023. The risk-free rate of investment in Poland was *** percent as of 2023.

Actual value and historical data chart for Brazil Risk Premium On Lending Prime Rate Minus Treasury Bill Rate Percent

The average market risk premium used in Russia was the highest in 2025, reaching a value of ** percent in that year. The lowest market risk premiums used in that year were in France and Japan, at *** percent respectively.

Risk premium on lending (lending rate minus treasury bill rate, %) in Nigeria was reported at 9.278 % in 2023, according to the World Bank collection of development indicators, compiled from officially recognized sources. Nigeria - Risk premium on lending (prime rate minus treasury bill rate, %) - actual values, historical data, forecasts and projections were sourced from the World Bank on October of 2025.

The average market risk premium used in Switzerland fluctuated between 2011 and 2024. As of 2024, the average market risk premium in Switzerland stood at *** percent.

The average market risk premium in Canada was *** percent in 2024. This means investors demanded an extra *** Canadian dollars on a 100 Canadian dollar investment. This extra cost should compensate for the risk of an investment based in Canada. What causes risk? As far as country-specific factors are concerned, macroeconomic trends can cause risk. For example, the inflation rate in relation to other countries can change the relative value of an investment. Lower inflation in Canada could weaken the Canadian dollar, reducing the value of Canadian assets in terms of another currency, such as the euro or U.S. dollar. The Canadian context As a country, Canada has a fairly high national debt. Some economists point to this as an increased default risk, since debt servicing can become costly. However, most investors agree that Canada, as an advanced economy, is creditworthy and not at risk of defaulting. A better measure is to look at Canada’s risk premium in the context of interest rates from other countries. These deposit rates can be used as a baseline for the market risk premium of other countries, though they do not include all the factors that have been used to calculate this statistic.

Actual value and historical data chart for Kenya Risk Premium On Lending Prime Rate Minus Treasury Bill Rate Percent

Actual value and historical data chart for Georgia Risk Premium On Lending Prime Rate Minus Treasury Bill Rate Percent

Armenia AM: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data was reported at 1.253 % pa in 2023. This records an increase from the previous number of 1.131 % pa for 2022. Armenia AM: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data is updated yearly, averaging 7.526 % pa from Dec 2001 (Median) to 2023, with 23 observations. The data reached an all-time high of 13.934 % pa in 2005 and a record low of 1.131 % pa in 2022. Armenia AM: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s Armenia – Table AM.World Bank.WDI: Interest Rates. Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the 'risk free' treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability.;International Monetary Fund, International Financial Statistics database.;;

Risk premium on lending (lending rate minus treasury bill rate, %) in South Africa was reported at 3.3425 % in 2024, according to the World Bank collection of development indicators, compiled from officially recognized sources. South Africa - Risk premium on lending (prime rate minus treasury bill rate, %) - actual values, historical data, forecasts and projections were sourced from the World Bank on November of 2025.

Actual value and historical data chart for Egypt Risk Premium On Lending Prime Rate Minus Treasury Bill Rate Percent

Sources:

German Central Bank (ed.), 1975: Deutsches Geld- und Bankwesen in Zahlen 1876 – 1975. (German monetary system and banking system in numbers 1876 – 1975) German Central Bank (ed.), different years: monthly reports of the German Central Bank, statistical part, interest rates German Central Bank (ed.), different years: Supplementary statistical booklets for the monthly reports of the German Central Bank 1959 – 1992, security statistics Reich Statistical Office (ed.), different years: Statistical yearbook of the German empire Statistical Office (ed.), 1985: Geld und Kredit. Index der Aktienkurse (Money and Credit. Index of share prices) – Lange Reihe; Fachserie 9, Reihe 2. Statistical Office (ed.), 1987: Entwicklung der Nahrungsmittelpreise von 1800 – 1880 in Deutschland. (Development of food prices in Germany 1800 – 1880) Statistical Office (ed.), 1987: Entwicklung der Verbraucherpreise (Development of consumer prices) seit 1881 in Deutschland. (Development of consumer prices since 1881 in Germany) Statistical Office (ed.), different years: Fachserie 17, Reihe 7, Preisindex für die Lebenshaltung (price index for costs of living) Donner, 1934: Kursbildung am Aktienmarkt; Grundlagen zur Konjunkturbeobachtung an den Effektenmärkten. (Prices on the stock market; groundwork for observation of economic cycles on the stock market) Homburger, 1905: Die Entwicklung des Zinsfusses in Deutschland von 1870 – 1903. (Development of the interest flow in Germany, 1870 – 1903) Voye, 1902: Über die Höhe der verschiedenen Zinsarten und ihre wechselseitige Abhängigkeit.(On the values of different types of interests and their interdependence).

The average market risk premium used in Norway fluctuated between 2011 and 2024. As of 2024, the average market risk premium (MRP) in the country reached a value of *** percent. In 2024, Norway had one of the lowest MRP rates in Europe.