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Vedonomics

Monday, July 19, 2010. Price multiples way of valuation. The technique of valuation. What are the types of valuation models? There are mainly two types of models used in valuation –. An absolute valuation model specifies an assets intrinsic value which can be compared with the asset’s market price. Examples of absolute valuation models are Present value or discounted cash flow models, Dividend discount models and Gordon growth model, Residual income model, Asset backed valuation models. P/E ratios are so...

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Monday, July 19, 2010. Price multiples way of valuation. The technique of valuation. What are the types of valuation models? There are mainly two types of models used in valuation –. An absolute valuation model specifies an assets intrinsic value which can be compared with the asset’s market price. Examples of absolute valuation models are Present value or discounted cash flow models, Dividend discount models and Gordon growth model, Residual income model, Asset backed valuation models. P/E ratios are so...
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Vedonomics | vedonomics.blogspot.com Reviews

https://vedonomics.blogspot.com

Monday, July 19, 2010. Price multiples way of valuation. The technique of valuation. What are the types of valuation models? There are mainly two types of models used in valuation –. An absolute valuation model specifies an assets intrinsic value which can be compared with the asset’s market price. Examples of absolute valuation models are Present value or discounted cash flow models, Dividend discount models and Gordon growth model, Residual income model, Asset backed valuation models. P/E ratios are so...

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1

Vedonomics: WHAT IS STOCK AUCTIONS

http://vedonomics.blogspot.com/2010/07/what-is-stock-auctions.html

Friday, July 9, 2010. WHAT IS STOCK AUCTIONS. Now, you are probably beginning to wonder what we are doing discussing auctions of slaves and commodities or art auction houses like Christie's and Sotheby's here, in the investment jungle! Allow us to clarify that our intention is not to discuss art auctions per se, but auctions conducted on the bourses. Auctions are not conducted only to sell merchandise or works of art in big auction houses they are also a common feature on stock exchanges. 61607; Signatur...

2

Vedonomics: June 2010

http://vedonomics.blogspot.com/2010_06_01_archive.html

Wednesday, June 16, 2010. Grinold and Kroner Model for valuation. Applied to equity markets, the most common application of discounted cash flow models is the Gordon growth model. It is most commonly used to back out the expected return on equity, resulting in the following –. Expected Returns(r) = Div1 / P0 g. Div1 = dividend in next period (period 1 assuming current t=0). G = real growth rate in earnings. The model states that:. Expected Returns(r) = Div1 /P0 i g - ΔS Δ (P/E). I= expected inflation rate.

3

Vedonomics: Behavioral issues in stock selection

http://vedonomics.blogspot.com/2010/07/behavioral-issues-in-stock-selection.html

Friday, July 9, 2010. Behavioral issues in stock selection. 8220;……anticipation is the manifestation of hope……anxiety is the manifestation of fear”. Heuristic – Driven Biases. Some of heuristic biases are-. 8226; Aversion to ambiguity- Aversion to ambiguity can be loosely defined as “fear of unknown”. For example If an investor knows that the market is going up and in momentum he sees the chance of a particular stock also going up more than 50% but when the market is sideways he does not ...8226; Loss av...

4

Vedonomics: PEG Ratio

http://vedonomics.blogspot.com/2010/06/peg-ratio.html

Wednesday, June 16, 2010. The ratio has won over many fans because:. 8226; The inputs can be quickly and readily found on nearly any financial site. 8226; It is relatively intuitive. 8226; It doesn't require any complex math. PEG = (P/E) / (projected growth in earnings). For example, a stock with a P/E of 30 and projected earnings growth next year of 15% would have a PEG of 30 / 15 = 2. A lower ratio is "better" (cheaper) and a higher ratio is "worse" (expensive). PEG as an indicator. A company's growth ...

5

Vedonomics: The lure of “Averaging”

http://vedonomics.blogspot.com/2010/07/lure-of-averaging.html

Friday, July 9, 2010. The lure of “Averaging”. One of the most popular theories in the stock market is the concept of "averaging". The idea of averaging is lucid and appears very rational. If a share that you bought falls in price then further buying will help bring the average purchase price down and hence it will increase your eventual profits. Let us understand this with the help of an illustration. DO’s AND DON’Ts. The idea of averaging makes sense only when you are sure of above average future perfo...

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Vedonomics

Monday, July 19, 2010. Price multiples way of valuation. The technique of valuation. What are the types of valuation models? There are mainly two types of models used in valuation –. An absolute valuation model specifies an assets intrinsic value which can be compared with the asset’s market price. Examples of absolute valuation models are Present value or discounted cash flow models, Dividend discount models and Gordon growth model, Residual income model, Asset backed valuation models. P/E ratios are so...

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