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Beta Explained: What It Is and How to Calculate It

Valutico

Book a demo here to see how Valutico can help you. Interpreting beta values is crucial for investors to understand an asset’s risk exposure and its relationship with the overall market. Therefore, recalculating beta periodically or when significant events occur is advisable for accurate risk assessment.

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Discounted-Cash-Flow-Analysis: Your Complete Guide with Examples

Valutico

Rf = Risk-free Rate. Rm – Rf) = Equity Market Risk Premium. Now, we need to calculate the discount rate. . Risk free rate (can use 10y Treasury). Try booking a demo , if this applies to you. Ce = Cost of Equity. B = Beta. (Rm Cp = Cost of Equity Premium. Cost of Debt.