Strategy Driven

SEPTEMBER 9, 2011

Many conventional metrics we use to estimate value are based on faulty assumptions. Net present value [NPV] is a case in point. In bond trading, there is no relationship, bond prices today have little to do with bond prices tomorrow, and I could completely change my positions overnight.

Innovation 50

Innovation NPV Business Model Constraint 50

Harvard Business Review

APRIL 27, 2017

One capital form is debt: a bond. Bonds give the debtor certainty over its ability to use the capital for a fixed period of time (unless there is a call provision written into them). However, unlike a bond, common equity is not long-term/forever on predetermined, immutable terms. The Refresher: Net Present Value.

Hedge 8

Hedge Short-term Long-term NPV 8

Harvard Business Review

MARCH 6, 2013

There are three main ways of explaining stock prices: The first is basic economics — a share of stock is worth the present value of the future cash flows associated with it. Put another way, a company's stock-market value is a function of how much money investors think it will make in the coming months and years.

Price 8

Price Bond Marketing Present Value 8

Harvard Business Review

DECEMBER 11, 2013

And now, post-election, it was critical that the bonds be strengthened further. These were engineers and network planners; surely, they understood economics and net present value analysis. But consider the economics,” I continued. “A You would forgo the chance to connect with the rest of Africa.”. I told them my story.

Net Present Value 8

Net Present Value Politics Analysis Telecommunications 8

Harvard Business Review

APRIL 2, 2014

You know, the future value of money, the present value of money — money today is worth more than in the future because you can invest it and get interest. This stochastic discount factor model is the modern economic update of those, correct? Instead, what you need to do is scenario analysis.

CAPM 8

CAPM Discount Price Finance 8