From db7efd01129299683cc3c19e6b7dff455dc0ac5b Mon Sep 17 00:00:00 2001 From: Pranav Peshwe Date: Wed, 26 Apr 2023 21:07:56 +0530 Subject: [PATCH] Fix extraneous escape. The backslash (which I suspect was introduced to escape the asterisk) is not needed and causes confusion. --- MODEL.markdown | 2 +- 1 file changed, 1 insertion(+), 1 deletion(-) diff --git a/MODEL.markdown b/MODEL.markdown index 58d1709..ab30678 100644 --- a/MODEL.markdown +++ b/MODEL.markdown @@ -205,7 +205,7 @@ If AFFO estimates is unavailable, we fall back to using FFO. However, if both ar The discount rate is calculated based on the following equation: - Discount rate = Cost of Equity = Risk Free Rate + (Levered Beta \* Equity Risk Premium) + Discount rate = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium) The risk-free rate is the 5-year average of the 10-year government bond rate. It is common for investors to simply use the current spot government bond rate, but we believe using the spot rate leads to highly volatile valuations. In our view these are not reflective of the company's true long-term value and lead to reactionary investment decisions that are not compatible with a long-term investment horizon.