The Great Valuation Game: Creating the illusion of expertise

The valuation profession understandably promotes the idea that a “valuation” represents an independent, objective (and presumably unbiased and reliable) estimate of the price at which a capital asset would sell for in a market transaction….

Avast! Are we not valuation analysts? No. We are valuation assumers.

Those in the sub-discipline of the finance profession employed in estimating values of privately-held and -traded capital assets refer to themselves by a fascinating array of–sometimes dyseuphonic–titles including business appraisers, valuers, valuators, valuation advisors, valuation…

Fair value estimation and revenue recognition

Rudyard Kipling said “East is East and West is West and never the twain shall meet.” Observations from my career in finance and accounting lead me to re-use his words: Valuation is valuation and accounting…

Estimating the global price of USD inflation risk

Executive summary for the mildly-interested reader: Although the average holding return for 1-year maturity US Treasuries during 2014-2018 was a negative .50% inside the US, the estimated return to such USD inflation risk in the…

Biological asset valuation: Risk pricing

This article continues from my basic discussion of biological asset valuation which presented an overview of the financial reporting requirements for biological assets, the fundamental problem of biological asset valuation, and a general solution to…

AMAZON: “International cost of capital estimation”

Available now on Amazon. The book presents a definitive, concise treatment of the modern capital asset pricing theories and related empirical methods needed by serious finance professionals for developing unbiased and reliable estimates of international…

An idiosyncratic view on ICC estimation methods

Regarding international cost of capital (ICC) estimation … I became involved in valuation via M&A transaction advisory services for mid-market industrial companies circa 1990. Because I was based in the Midwestern USA, many clients were…

What all valuation professionals need to know about IPCPL

In the valuation profession, there have been long-standing, unproductive arguments about how best to estimate something called the discount for lack of marketability (DLOM) for assets traded only in private capital markets.  In contrast, estimation…

What all finance professionals need to know about international cost of capital

In his book, “A Theory of Global Capitalism: Production, Class, and State In a Transnational World” published in 2004, the well-known sociologist William I. Robinson documents the how increasing global capital mobility has resulting in…

International cost of capital estimation

You are a well-trained finance professional working in a globalized capital market environment. You need to know the basics of estimating international cost of capital. All that is required to develop accurate, reliable estimates of…