Andrew Stolz

AUGUST 5, 2020

Definition of the Cost of Equity. To compensate for the risks that shareholders take, firms pay them in return. The theoretical return the firm pays its equity investors (shareholders) is known as the cost of equity. In other words, the cost of equity is the rate of returns a firm pays to its shareholders.

Equity 52

Equity Risk-free Rate Dividends Beta 52

Andrew Stolz

AUGUST 5, 2020

If an investor moves money from the risk-free asset into the stock market, they should expect to earn a return in excess of the risk-free rate, what is called an equity risk premium. Investments are exposed to two types of risk: systematic and unsystematic. What Impacts the Capital Asset Pricing Model?

Risk-free Rate 52

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

Equilest

JANUARY 1, 2023

The Unlevered-Beta (Known also as Unleveraged-Beta) is related to systematic risk. . You can read more about systematic risk here. . . Financial leverage is defined as the ratio between foreign capital and equity. E = Equity. . The Financial Leverage of The Firm. BL = Leveraged-Beta. Conclusion.

Beta 40

Beta Unlevered Beta Systematic Risk Equity 40

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business. What is the WACC?

Weighted Average Cost of Capital 52

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

Valutico

APRIL 17, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business. What is the WACC?

Weighted Average Cost of Capital 52

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

Valutico

APRIL 12, 2023

Determining a company’s “Cost of Capital” is vital in corporate finance and valuation, and the Weighted Average Cost of Capital (WACC) provides a specific way of doing so. These costs are then combined into a “weighted average” which represents the overall cost of financing a business. What is the WACC?

Weighted Average Cost of Capital 52

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

Andrew Stolz

AUGUST 6, 2020

Beta is the risk statistic used to compare the portfolio’s exposure to systematic risk to that of the market. A portfolio with a beta of one is equally exposed to systematic risk as the market. A high beta indicates more risk, while a low beta indicates less risk.

Beta 52

Beta Covariance Systematic Risk Marketability 52