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What do you mean by excess returns?
Excess income refers to the net income of an enterprise MINUS the profit of tangible net assets (normal income), and its total goodwill = total income-tangible net assets * normal average rate of return; Excess income means that the goodwill is higher than that of similar enterprises in the same industry facing the same risks and uncertainties.

Excess rate of return refers to the rate of return that exceeds the normal (or expected) rate of return, which is equal to the difference between the rate of return on a certain day and the normal (expected) rate of return required by investors (or markets) on that day. The excess rate of return is the difference between the actual rate of return of a stock and its normal rate of return, in which the normal rate of return is the expected rate of return when the event does not occur. Here we use the data of the above parameter estimation period to estimate the normal rate of return. Here we choose the market model, which is expressed as: Rit = αi+βiRim+εit, where Rit is the actual rate of return of stock I in T period; Rim is the yield of T-period market, which is expressed by celestial circulation index; ε It is a random perturbation term.

Regression of the above formula with least square estimation method, estimation of αi and βi with the data of parameter estimation period, and assuming that V and βi remain unchanged during the event period, we can get the excess returns and accumulated excess returns during the event period: ARit is the calculated excess returns of stock I during the event period, and Rit is the actual returns of stock I during the event period. Rim is the celestial circulation index (market return rate) in the event period T, αi and βi are the parameter values estimated by the market model, CARit is the cumulative excess return rate of stock I in the event period T, AARt is the average excess return rate in the event period T, and CARt is the cumulative average excess return rate in the event period T. ..

Excess income method is a method to evaluate the goodwill of enterprises based on the excess income of reorganized enterprises. Income method refers to the method of determining the value of the appraised assets by estimating the expected future income of the appraised assets and converting it into the present value. By forecasting and discounting the future income of the appraised assets, the sum of the discounted values of the annual income is taken as the appraised value of the assets.