Valutico

FEBRUARY 27, 2024

For central banks like the Federal Reserve, it helps control the economy. They set this rate to affect how much money moves through banks and influences short-term interest rates. We are going to focus on how discount rates are used in the context of investment, rather than in the context of central banks.

Discounted Cash Flow 52

Discounted Cash Flow Risk Premium Risk-free Rate Beta 52

Musings on Markets

AUGUST 15, 2023

Risk Free Investments: Definition, Role and Measures The place to start a discussion of risk-free rates is by answering the question of what you need for an investment to be risk-free, following up by seeing why that risk-free rate plays a central role in corporate finance and investing and then looking at the determinants of that risk-free rate.

Risk-free Rate 98

Risk-free Rate Treasury Risk Premium Start-ups 98

Simply Treasury

AUGUST 2, 2022

The idea is not new to encourage companies to increase their capitalization and reduce their bank debt (partly through more recourse to the capital market - CMU project). The rate would be calculated based on a 10-year "risk-free interest" rate depending on the currency, increased by a 1% risk premium (1.5%

Equity 52

Equity Risk Premium Banking Finance 52

Musings on Markets

MAY 24, 2021

Implicit in this definition are two key components of inflation. The first is that to define purchasing power, you have to start with a definition of what you are purchasing, and this detail, as we will see, can lead to differences in inflation measured over a given period, across measures/services.

Treasury 55

Treasury Start-ups Risk Premium Price to Book 55

Musings on Markets

JANUARY 27, 2021

In my last post , I described the wild ride that the price of risk took in 2020, with equity risk premiums and default spreads initially sky rocketing, as the virus led to global economic shutdowns, and then just as abruptly dropping back to pre-crisis levels over the course of the year. against developed market currencies.

Start-ups 52

Start-ups Marketability Equity Treasury 52

Musings on Markets

JULY 1, 2022

In this post, I will argue that almost everything that we are observing in markets, across asset classes, can be explained by a pull back on risk capital, and that understanding the magnitude of the pull back, and putting in historical perspective, is key to gauging what is coming next. Risk Capital: What is it?

Marketability 99

Marketability Risk Premium Start-ups Equity 99

Musings on Markets

JULY 25, 2023

The second is that what comprises default in the sovereign CDS market may not coincide with investor definitions of default , though there are approaches that can be used to back out the likelihood of default from a CDS value. in my July 2023 update) and apply this scalar to the default spread, to arrive at a country risk premium.

Risk Premium 52

Risk Premium Equity Start-ups Risk-free Rate 52