Harvard Business Review

MARCH 10, 2011

knew that firms were making heavy use of the capital asset pricing model (CAPM) to size up growth opportunities, but that the model was only as good as its inputs. But that article was written a decade ago, and still the CAPM rules — and as for how to come up with the crucial inputs to it, well, practice remains all over the map.

CAPM 14

CAPM Cost Discounted Cash Flow Cost of Capital 14

Harvard Business Review

OCTOBER 14, 2013

I think he got the Nobel nod (instead of somebody like Andy Lo , or Mordechai Kurz , or Roman Frydman ) because he was (1) very early to the game, (2) a macroeconomist (the Nobel people generally seem more comfortable with macro than with finance), and (3) most suited to being shoehorned into a narrative of steady scientific progress.

CAPM 8

CAPM Finance Price Uncertainty 8

Harvard Business Review

JUNE 18, 2015

In particular, we are interested in how many of their responses correlate with what academic finance knows and what it teaches. Furthermore, few PE investors explicitly use the capital asset price model (CAPM) to determine a cost of capital. the notion that debt financing can be “cheap” at certain times).

Discounted Cash Flow 8

Discounted Cash Flow CAPM Company Rate of Return 8

Harvard Business Review

JANUARY 15, 2014

Though there are multiple types of prediction, the gold standard is the prediction of precise outcomes.

Black-Scholes 8

Black-Scholes Productivity Products CAPM 8

Harvard Business Review

APRIL 2, 2014

He got his PhD at Yale under Shiller’s supervision in 1984, but since then he has also done a lot of work expanding on Fama’s ideas about risk and return, some of it co-authored with Fama’s son-in-law and University of Chicago finance colleague, John Cochrane. And the theory that was available then was CAPM. It goes back to the 1970s.

CAPM 8

CAPM Discount Price Finance 8

Harvard Business Review

MARCH 10, 2011

This is the key finding of the Current Trends in Estimating and Applying the Cost of Capital research released this week by the Association for Financial Professionals, a trade group of 16,000 corporate treasury and finance practitioners. Download this pdf for an executive summary, or login here for the full report.)

Cost of Capital 13

Cost of Capital Cost CAPM Discounted Cash Flow 13