Musings on Markets

JANUARY 9, 2021

Challenge rules of thumb and conventional wisdom : Investing has always had rules of thumb on how and when to invest, ranging from using historical PE or CAPE ratios to decide if markets are over valued, to simplistic rules (eg. buy stocks that trade at less than book value or trade at PEG ratios less than one) for individual stocks.

Risk Premium 52

Risk Premium Market Capitalization Equity Start-ups 52

Musings on Markets

FEBRUARY 27, 2023

An Optimizing Tool In my second and third data posts for this year, I chronicled the effects of rising interest rates and risk premiums on costs of equity and capital. The market debt ratio, in contrast, uses the market's estimate of the value of equity, i.e., its market capitalization, as the value of equity.

Equity 52

Equity EBITDA Start-ups Net Debt 52

Musings on Markets

JANUARY 6, 2023

For example, I have seen it asserted that a stock that trades at less than book value is cheap or that a stock that trades at more than twenty times EBITDA is expensive. I do report on a few market-wide data items especially on risk premiums for both equity and debt. Equty Risk Premiums, by Country 4.

Risk Premium 52

Risk Premium Dividends EBITDA Start-ups 52

Musings on Markets

JULY 22, 2021

The second is the cost of capital, a number that most valuation classes and books (including mine) belabor to the point of diminishing returns. It is a money loser There are good arguments to be made against investing in Zomato at is proposed offering price, but one of the emptiest, and laziest, is that it is losing money right now.

Marketability 86

Marketability Start-ups Equity Price to Book 86