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Data Update 4 for 2024: Danger and Opportunity - Bringing Risk into the Equation!

Musings on Markets

Third, by making investing a choice between good (higher returns) and bad (higher risk), a message is sent, perhaps unwittingly, that risk is something to be avoided or hedged. micro uncertainties, into discount rates, and in the process, they end up incorporating risk that investors can eliminate, often at no cost.

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Data Update 4 for 2021: The Hurdle Rate Question!

Musings on Markets

In this post, I will start by looking at the role that hurdle rates play in running a business, with the consequences of setting them too high or too low, and then look at the fundamentals that should cause hurdle rates to vary across companies.