This book is based on a series of seminars delivered over a period of many years to people
working in the global financial markets. The material has expanded and evolved over that
time. Participation on the seminars has covered the widest possible spectrum in terms of
age, background and seniority, ranging all the way from new graduate entrants to the financial
services industry up to very senior managing directors.
Dividend discount model (DDM) A model for valuing the common stock of a company, based on the present value of the expected cash flows.
Dividend growth model A model wherein dividends are assumed to be at a constant rate in perpetuity. Dividend limitation A bond covenant that restricts in some way the firm's ability to pay cash dividends. Dividend payout ratio Percentage of earnings paid out as dividends. Dividends per share Amount of cash paid to shareholders expressed as dollars per share. Dividend policy An established guide for the firm to determine the amount of money it will pay as...
It also contributes to increase confidence in the protection scheme and in the banking industry. The
appropriate dimension of the fund level depends on the amount and the types of insured deposits.
Obviously, all countries where a fund has been raised face the important problem of managing it in
such a way to balance the trade off between the objective to minimize ex-post reintegration
following future payouts (that is, maximizing its expected return) and the objective to count on a
safe, quick and easy to use amount of funds for immediate needs.
We also asked respondents a number of questions regarding PPI payouts, establishing that these refunds look set to play a
key role in assisting the savings recovery. Our survey findings showed that 4.3 per cent of Britons had received or expected
to receive a payout this year – equivalent to over two million UK adults.
With average refunds of around £2,600, according to the findings, Britons can expect to receive £5.6 billion in refunds this
In addition to emphasizing long-horizon expected returns, the approach taken here differs
from previous treatments in that it uses ex ante estimates of expected returns, rather than ex post
actual returns. Expected returns are estimated by incorporating corporate cash flow projections
into an expanded version of the Campbell and Shiller (1988, 1989) dividend-price ratio model, in
which the log of the price-earnings ratio is a linear function of required future returns, expected
earnings growth rates, and expected dividend payout rates.