Valuation Master Class

Time value of money describes how the sum of money that you hold currently is worth more than the equivalent sum in the future.

The risk-free rate is the ‘theoretical’ minimum rate of return on investments with no risk.

Equity-risk premium is the difference between expected returns from the stock market and the expected returns from risk-free investments.

Valuation Master Class Student Essay: Invested Capital Growth is one of the most important forecasts in firm valuation. In this essay, I will explain the fundamentals of invested capital growth, its importance, and how to forecast it.

Valuation Master Class Student Essay: Cash is like oxygen to a company. Regardless of how profitable a company is, if the business is unable to generate cash to cover its creditors, the company will run the risk of bankruptcy and collapse. One method to measure liquidity is Cash Conversion Cycle (CCC).

Valuation Master Class Student Essay: The world has become globalized; companies who have cross-border activities are engaged in currency exposure. As everyone knows the fact that the currency exchange rate is highly volatile. Multinational companies may confront a loss of revenue when incomes from foreign subsidiaries converted to the home currency.

Valuation Master Class Student Essay: Most valuation models are built for the healthy, on-going company. When used to value a declining company, analysts will face special challenges as the characteristics of a declining company will cause some of the valuation model’s assumptions to break down.

Valuation Master Class Student Essay: Commodities are alternative investments. They can provide significant benefits to the portfolio’s diversification as well as inflation protection. They can also be used to trade based on the macroeconomic view of traders, such as arbitrageurs or speculators.

Valuation Master Class Student Essay: The yield curve is a line that plots the bond yields at a set point in time, of bonds having equal credit quality against their maturities. The curve shows the relation between the interest rate and the time to maturity. Typically, bond maturities vary from 3 months to 30 years.