The equity risk premium is the price of risk in equity markets and is a key input in estimating costs of equity and capital in both corporate finance and valuation. Given its importance, it is surprising how haphazard the estimation of equity risk premiums remains in practice. We begin this...

A standard critique of valuation models, in general, and discounted cash flow models in particular is that they fail to fully account for the many intangible assets possessed by firms. There have been attempts to value brand name, trade marks and copyrights and bring them on to the balance...

As companies and investors globalize, we are increasingly faced with estimation questions about the risk associated with this globalization. When investors invest in China Mobile, Infosys or Vale, they may be rewarded with higher returns, but they are also exposed to additional risk. When...

The equity risk premium is the price of risk in equity markets, and it is not just a key input in estimating costs of equity and capital in both corporate finance and valuation, but it is also a key metric in assessing the overall market. Given its importance, it is surprising how haphazard the...

In early February of 2020, when US equities were hitting all-time highs and the US economy was showing strength, a virus, that many believed would be isolated to China and cruise ships, surged into the rest of the world. The resulting economic shut down put stocks into a tailspin, starting the...

The equity risk premium is the price of risk in equity markets, and it is not just a key input in estimating costs of equity and capital in both corporate finance and valuation, but it is also a key metric in assessing the overall market. Given its importance, it is surprising how haphazard the...

For decades, private companies planning to enter public markets have used bankers operating as intermediaries, helping them decide on issue timing and pricing, and in meeting disclosure requirements. That banker-led process has always had inefficiencies, but without clear alternatives, companies...

The equity risk premium is the price of risk in equity markets, and it is a key input in estimating costs of equity and capital in both corporate finance and valuation. Given its importance, it is surprising how haphazard the estimation of equity risk premiums remains in practice. We begin this...

Equity risk premiums are a central component of every risk and return model in finance and are a key input into estimating costs of equity and capital in both corporate finance and valuation. Given their importance, it is surprising how haphazard the estimation of equity risk premiums remains in...

For much of the last century, value investors considered themselves to be the winners in the investment world, a result they attributed to their patience, maturity and good sense. That view, at least on the surface, was backed up by evidence that “value” stocks, defined as stocks that trade...