Reports parameters used.
Aswath Damodaran 107
Choosing the Parameters: Disney
! Period used: 5 years
! Return Interval = Monthly
! Market Index: S&P 500 Index.
! For instance, to calculate returns on Disney in December 1999 ,
- Price for Disney at end of November 1999 = $ 27. 88
- Price for Disney at end of December 1999 = $ 29. 25
- Dividends during month = $ 0. 21 (It was an ex-dividend month)
- Return =($ 29. 25 - $ 27. 88 + $ 0. 21 )/$ 27. 88 = 5. 69 %
! To estimate returns on the index in the same month
- Index level (including dividends) at end of November 1999 = 1388. 91
- Index level (including dividends) at end of December 1999 = 1469. 25
- Return =( 1469. 25 - 1388. 91 )/ 1388. 91 = 5. 78 %
