English Abstract: During the last 10 years (2001-2011), the average return of the mutual funds in Spain (1.3%) was smaller than the average inflation. Nevertheless, on December 31, 2011, 4.9 million investors had 128 billion euros in the 2,471 existing mutual funds. Only 1 of the 368 mutual...

English Abstract: During the last 10 years, the average return of the pension funds in Spain was lower than the inflation and than the return of Government Bonds. Only 2 funds (out of 532) had a return higher than the return of Government Bonds. Nevertheless, on December 31, 2011, 5.1 million...

This paper addresses 10 corporate finance topics that are not well treated (or not treated at all) in many Corporate Finance Books. The topics are: 1. Where does the WACC equation come from? 2. The WACC is not a cost. 3. What is the WACC equation when the value of the debt is not equal to its...

The value of tax shields depends only on the nature of the stochastic process of the net increases of debt. The value of tax shields in a world with no leverage cost is the tax rate times the current debt plus the present value of the net increases of debt. By applying this formula to specific...

This paper contains a collection and classification of 119 errors seen in company valuations performed by financial analysts, investment banks and financial consultants. The author had access to most of the valuations referred to in this paper in his capacity as a consultant in company...

We value a company that targets its capital structure in book - value terms. This capital structure definition provides us with a valuation that lies between those of Modigliani - Miller (fixed debt) and Miles - Ezzell (fixed market - value leverage ratio). We show that if a company targets its...

This paper contains the statistics of the Equity Premium or Market Risk Premium (MRP) used in 2012 for 82 countries. We got answers for 93 countries, but we only report the results for 82 countries with more than 5 answers.Most previous surveys have been interested in the Expected MRP, but this...

On April 16, 2012 the Argentine Federal Government decreed the intervention of YPF and expropriated of 51% of the YPF shares owned by Repsol. Repsol had a 57.4% stake. A tribunal will determine the compensation Repsol will receive for its YPF shares. You are required to help the tribunal. What...

Company valuation using discounted cash flows is based on the valuation of the Government bonds: it consists of applying the procedure used to value the Government bonds to the debt and shares of a company. This is easy to understand (sections 1, 2 and 3). But company valuation is complicated by...

Spanish Abstract: Esta nota contiene un caso real de una empresa que tenía un crédito con tipo de interés variable y contrató un swap para pagar tipo de interés fijo y eliminar su riesgo de interes. La nota tambien contiene 30 comentarios sobre el swap y varias contestaciones a los mismos...