GLENTYDE

Capital Advisors

INNOVATION ♦ FOCUS ♦ PRECISION

Capital Budgeting

• Use caution when using probability-weighted discount rates in a capital budgeting (or any similar asset-valuation) scenario. A straightforward, intuitive approach to expected rates might lead to a nonobvious error. Complete article
• The familiar formula for the Present Value of Growth Opportunities can be easily derived from first principles. Such a derivation should provide the insight and foundation for the development of PVGO models which don't require the simplifying assumptions of the elementary model. Complete article