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2. Risk-free rate - Wikipedia

   en.wikipedia.org/wiki/Risk-free_rate

   The risk-free rate is also a required input in financial calculations, such as the Black–Scholes formula for pricing stock options and the Sharpe ratio. Note that some finance and economic theories assume that market participants can borrow at the risk-free rate; in practice, very few (if any) borrowers have access to finance at the risk free ...

3. Discounted cash flow - Wikipedia

   en.wikipedia.org/wiki/Discounted_cash_flow

   Free Cash Flow Projections: Projections of the amount of Cash produced by a company's business operations after paying for operating expenses and capital expenditures. [1] Discount Rate: The cost of capital (Debt and Equity) for the business. This rate, which acts like an interest rate on future Cash inflows, is used to convert them into ...

4. Net present value - Wikipedia

   en.wikipedia.org/wiki/Net_present_value

   Yet another issue can result from the compounding of the risk premium. R is a composite of the risk free rate and the risk premium. As a result, future cash flows are discounted by both the risk-free rate as well as the risk premium and this effect is compounded by each subsequent cash flow. This compounding results in a much lower NPV than ...

5. Risk-Free Rate: Definition and Usage - AOL

   www.aol.com/news/risk-free-rate-definition-usage...

   Continue reading ->The post Risk-Free Rate: Definition and Usage appeared first on SmartAsset Blog. When building an investment portfolio, finding the right balance between risk and reward is ...

6. Valuation using discounted cash flows - Wikipedia

   en.wikipedia.org/wiki/Valuation_using_discounted...

   Note that in practice the required probability factors are usually too uncertain to do this. [12] An extension of scenario-based valuations is to use Monte Carlo simulation, [21] passing relevant model inputs through a spreadsheet risk-analysis add-in, such as @Risk or Crystal Ball.

7. Capital asset pricing model - Wikipedia

   en.wikipedia.org/wiki/Capital_asset_pricing_model

   The intercept is the nominal risk-free rate available for the market, while the slope is the market premium, E(R m)− R f. The security market line can be regarded as representing a single-factor model of the asset price, where β is the exposure to changes in the value of the Market. The equation of the SML is thus: : = + (()).