Valutico

FEBRUARY 27, 2024

To refine the selection of the discount rate, it’s important to draw on inputs from credible sources regarding economic, industry and company specific risk factors. Risk Premium: The risk premium reflects the additional return investors demand for taking on the risk of investing in the overall market.

Discounted Cash Flow 52

Discounted Cash Flow Risk Premium Risk-free Rate Weighted Average Cost of Capital 52

Andrew Stolz

AUGUST 5, 2020

It helps an investor understand what to expect to earn in relation to the risk-free rate and the market return. CAPM assumes that the minimum a rational investor would earn is the risk-free rate by buying the risk-free asset. Investments are exposed to two types of risk: systematic and unsystematic. E(r) = Rf + ??(Rm

Risk-free Rate 52

Risk-free Rate Beta Weighted Average Cost of Capital Risk Premium 52

Valutico

APRIL 17, 2023

This model takes into account a variety of factors, such as risk-free rate, beta, and expected market returns. Cost of equity (or “discount rate”), which considers the expected rate of return given current market conditions and the risk associated with investing in the company. A beta of 1.0

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 17, 2023

This model takes into account a variety of factors, such as risk-free rate, beta, and expected market returns. Cost of equity (or “discount rate”), which considers the expected rate of return given current market conditions and the risk associated with investing in the company. A beta of 1.0

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Valutico

APRIL 12, 2023

This model takes into account a variety of factors, such as risk-free rate, beta, and expected market returns. Cost of equity (or “discount rate”), which considers the expected rate of return given current market conditions and the risk associated with investing in the company. A beta of 1.0

Weighted Average Cost of Capital 52

Weighted Average Cost of Capital Discounted Cash Flow Beta Risk-free Rate 52

Musings on Markets

FEBRUARY 10, 2021

Capital Constrained Clearing Rate : The notion that any investment that earns more than what other investments of equivalent risk are delivering is a good one, but it is built on the presumption that businesses have the capital to take all good investments. More on that issue in a future data update post.)

Risk-free Rate 52

Risk-free Rate Risk Premium Start-ups Equity 52

Brian DeChesare

JULY 27, 2022

Let’s say that Target has a bond with an 8% Yield to Maturity , i.e., you earn an internal rate of return (IRR) of 8% if you buy the bond at its current market price and hold it until maturity. The Walmart bond’s YTM is still 5%, so its market price is the same. We’re betting that company-specific factors will change each bond’s price.

Equity 52

Equity Start-ups Private Equity Firm Beta 52