EFTA Document EFTA01449293

23 August 2013 US Equity Insights Figure 6: S&P 500 trailing PE and implied equity risk premium: PE is now close to long-term historical average but ERP is still 200bps higher than its average of 390bps. 35 30 25 20 15 10 5 OverstatedEl:Shorn inflationdistothons ri grtigRginiii§EFEAm . LTM RE LW Sant se FRA Drada Br* - Inv( odERP trhs • -AvgPE -15 9 Treasury yields now exceed the dividend yield. but dividends should grow double.digit for the next tew years as the payout ratio