Musings on Markets

JUNE 2, 2025

That left Moody's, the third of the major sovereign ratings agencies, as the only one that persisted with a Aaa (Moody's equivalent of AAA) for the US, but that changed on May 16, 2025, when it too downgraded the US from Aaa (negative) to Aa1 (stable).

Risk Premium 116

Risk Premium Marketability Start-ups Risk-free Rate 116

Musings on Markets

OCTOBER 4, 2023

Price of Risk The drop in stock and bond prices in the third quarter of 2023 can partly be attributed to rising interest rates, but how much of that drop is due to the price of risk changing? My assessment is a bit of a cop-out, since they are built on current interest rate levels and consensus earnings estimates.

Marketability 123

Marketability Start-ups Risk Premium Treasury 123

Musings on Markets

JANUARY 24, 2024

It is entirely possible that there will be a recession in 2024 or even in 2025, but what good is a signal that is two or three years ahead of what it is signaling? Other Currencies The rise in interest rates that I chronicled for the United States played out in other currencies, as well.

Treasury 52

Treasury Risk Premium Start-ups Risk-free Rate 52

Equidam

JUNE 30, 2025

Updated Market Conditions Inputs – Risk-free rates: Now 4-5% vs. near-zero during ZIRP – Market risk premiums: Adjusted for current volatility and country-specific factors – Survival rates: Updated data reflecting current market conditions 2. Here’s how Equidam approaches this: 1.

Equity 59

Equity Marketability Risk-free Rate Start-ups 59

Musings on Markets

JANUARY 17, 2025

In my last post , I noted that the US has extended its dominance of global equities in recent years, increasing its share of market capitalization from 42% in at the start of 2023 to 44% at the start of 2024 to 49% at the start of 2025.

Equity 129

Equity Risk Premium Treasury Start-ups 129

Musings on Markets

JANUARY 28, 2025

In 2022, the rise in rates was almost entirely driven by rising inflation expectations , with the Fed racing to keep up with that market sentiment. If you look back at my S&P 500 valuation in my second data post for this year, you will see that I left the treasury bond rate at 4.58% (its level at the start of 2025) unchanged through time.

Banking 70

Banking Treasury Risk Premium Start-ups 70

Musings on Markets

FEBRUARY 6, 2025

I am no expert on exchange rates, but learning to deal with different currencies in valuation is a prerequisite to valuing companies. The second is the estimation of the default spread , and in my simplistic approach, I use one of two approaches - a default spread based upon the sovereign rating or a sovereign credit default swap spread.

Risk Premium 69

Risk Premium Start-ups Enterprise Value Equity 69