Anonymous

18 Apr 2019

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General Investing

How do you select what discount rate to use for valuation?

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Sandra Teo

22 Mar 2019

One of the common methods used is the weighted average cost of capital (WACC). WACC is simple terms is the average cost of financing / raising money required by the firm. To determine WACC, you will need to determine the capital structure of the firm and the proportion of each financing source.

E = Market value of company's equity

D = Market value of company's debt

V = Total market value of company

Re = Cost of Equity

Rd = Cost of Debt

Tc = Tax rate

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Has anyone used an interactive broker to change SGD to USD? Are the rates good? How to find the exchange rates they use?

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