Musings on Markets

JULY 17, 2023

Exacerbating the pain, corporate default spreads rose during the course of 2022: While default spreads rose across ratings classes, the rise was much more pronounced for the lowest ratings classes, part of a bigger story about risk capital that spilled across markets and asset classes.

Marketability 98

Marketability Risk Premium Start-ups Treasury 98

Musings on Markets

JANUARY 27, 2022

Measuring inflation is not as simple as it looks, and measures of inflation can vary depending on the basket of good/services used, the perspective adopted (consumer, producer, GDP deflator) and the sampling used to collect prices.

Risk-free Rate 99

Risk-free Rate Treasury Price to Book Start-ups 99

Musings on Markets

JANUARY 9, 2021

Consider, for instance, an investor who picks stocks based upon price to book ratios, who finds a stock trading at a price to book ratio of 1.5. In the same dataset where I compute historical equity risk premiums, I report historical returns on corporate bonds in two ratings classes (Moody’s Aaa and Baa ratings).

Risk Premium 52

Risk Premium Market Capitalization Equity Start-ups 52

Musings on Markets

JULY 22, 2021

History and Business Model Zomato was founded in 2008 by Deepinder Goyal and Pankaj Chaddah, as Foodiebay, in response to the difficulties that they noticed that their office mates were having in downloading menus for restaurants. Overall, I will attach a likelihood of failure of 10%, reflecting this balance.

Marketability 99

Marketability Start-ups Equity Price to Book 99

Musings on Markets

JANUARY 19, 2022

When you augment this price change with the dividends on the index during 2021, the total return on the S&P 500 for 2021 was 28.47%. The results are similar if you break stocks down based upon price to book ratios or revenue growth rates.

Risk Premium 99

Risk Premium Risk-free Rate Start-ups Equity 99

Musings on Markets

MARCH 19, 2022

The overriding message in all of this data is that Russia/Ukraine war has unleashed fears in the bond market, and once unleashed that fear has pushed up worries about default and default risk premia across the board.

Start-ups 100

Start-ups Risk Premium Equity Market Capitalization 100

Musings on Markets

MARCH 25, 2021

Interest Rates and Value As interest rates have risen, the discussion in markets has turned ito the effects that these rates will have on stock prices. Risk premiums No effect or even a decrease. Risk premia may rise as inflation increases, because higher inflation is almost always more volatile than low inflation.

Equity 52

Equity Risk-free Rate Treasury Start-ups 52