Remove 2021 Remove Risk Premium Remove Risk-free Rate
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Data Update 2 for 2021: The Price of Risk!

Musings on Markets

If, on the other hand, investors are risk neutral, the price of risk will be zero, and investors will buy risky business, stocks and other investments, and settle for the risk free rate as the expected return.

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Data Update 2 for 2023: A Rocky Year for Equities!

Musings on Markets

It is the nature of stocks that you have good years and bad ones, and much as we like to forget about the latter during market booms, they recur at regular intervals, if for no other reason than to remind us that risk is not an abstraction, and that stocks don't always win, even in the long term.

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Data Update 3: Inflation and its Ripple Effects!

Musings on Markets

Inflation numbers have been coming in high now, for more than a year, but for much of the early part of 2021, bankers, investors and politicians seemed to be either in denial or casually dismissive of its potential for damage.

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A Zomato 2022 Update: Value, Pricing and the Gap

Musings on Markets

On July 21, 2021, I valued Zomato just ahead of its initial public offering at about ? 169 per share in late 2021. per share, and the mood and momentum that worked in its favor for most of 2021 had turned against the company. 15,000 in March 2021 to ? 41 per share. 2000 per share, and the stock is currently trading at ?

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In Search of a Steady State: Inflation, Interest Rates and Value

Musings on Markets

It is precisely because we have been spoiled by a decade of low and stable inflation that the inflation numbers in 2021 and 2022 came as such a surprise to economists, investors and even the Fed. Note that in all three cases, it is not the Fed that is driving rates, but what is happening to inflation.

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Data Update 4 for 2022: Risk = Danger + Opportunity!

Musings on Markets

Relative Risk Measures Before we embark on how to measure relative risk, where there can be substantial disagreement, let me start with a statement on which there should be agreement. By the same token, Embraer and TCS are global firms that happen to be incorporated in Brazil and India, respectively.

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Interest Rates, Earning Growth and Equity Value: Investment Implications

Musings on Markets

The first quarter of 2021 has been, for the most part, a good time for equity markets, but there have been surprises. The first has been the steep rise in treasury rates in the last twelve weeks, as investors reassess expected economic growth over the rest of the year and worry about inflation. for 2021 and inflation of 2.2%

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