The IDW’s Expert Committee on Business Valuation and Business Administration (FAUB) has adjusted its recommendation for the market risk (equity risk) premium. At its meeting on 12 October 2026, the committee set the range before personal taxes at 4.5% to 6.0%. The previous range, issued on 22 September 2025, was 5.25% to 6.75%.

FAUB points to two developments. The base rate derived from the yield curve using the Svensson method has risen further, and implied equity return expectations have stabilised this year. According to FAUB, keeping the old range would mean assuming a total return above the empirically observed band of roughly 6% to 10% (in a normal inflation environment).

Under the current German flat-rate withholding tax system, the recommended market risk premium after personal taxes now ranges from 4.0% to 5.25%.

Read the original IDW announcement »