Musings on Markets

JANUARY 28, 2024

In short, if you don't like betas and have disdain for modern portfolio theory, your choice should not be to abandon risk measurement all together, but to come up with an alternative risk measure that is more in sync with your view of the world. Data Update 2 for 2024: A Stock Comeback - Winning the Expectations Game!

Risk Premium 93

Risk Premium Beta Start-ups Equity 93

Musings on Markets

JANUARY 5, 2024

I have also developed a practice in the last decade of spending much of January exploring what the data tells us, and does not tell us, about the investing, financing and dividend choices that companies made during the most recent year. Beta & Risk 1. Dividends and Potential Dividends (FCFE) 1. Equity Risk Premiums 2.

Dividends 98

Dividends Risk Premium Equity Book Value 98

Musings on Markets

JANUARY 31, 2024

In my last three posts, I looked at the macro (equity risk premiums, default spreads, risk free rates) and micro (company risk measures) that feed into the expected returns we demand on investments, and argued that these expected returns become hurdle rates for businesses, in the form of costs of equity and capital.

Equity 79

Equity Book Value Start-ups Corporate Finance 79

Musings on Markets

JANUARY 21, 2023

The first is the dividends you receive, while you hold stocks, a cash flow stream that provides a measure of stability to investors who seek it. As with the yield to maturity for a bond, I solve for the discount rate (IRR) that makes the present value of cashflows on the index equal to the level of the index. Stocks: The What Next?

Equity 70

Equity Risk Premium Start-ups Dividends 70