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Examining the Effectiveness of Discounted Cash Flow Models

Braw, Daniel LU (2010) NEKK01 20092
Department of Economics
Abstract
The paper examines whether a variation of the one and two period discounted cash flow models using optimized investment horizons can be used to explain and/or predict stock prices. In addition to this, the optimized horizons themselves are analyzed to see how long a stock is held in different market climates.

The results show that the models cannot be used for pricing stocks. Neither can they explain stock prices. Regarding the investment horizon, no conclusive results are generated.
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author
Braw, Daniel LU
supervisor
organization
course
NEKK01 20092
year
type
M2 - Bachelor Degree
subject
keywords
Stock Valuation, Market Efficiency, Discounted Cash Flow, Gordon's Formula, DCF
language
English
id
1613634
date added to LUP
2010-06-21 09:04:28
date last changed
2010-06-21 09:04:28
@misc{1613634,
  abstract     = {The paper examines whether a variation of the one and two period discounted cash flow models using optimized investment horizons can be used to explain and/or predict stock prices. In addition to this, the optimized horizons themselves are analyzed to see how long a stock is held in different market climates.

The results show that the models cannot be used for pricing stocks. Neither can they explain stock prices. Regarding the investment horizon, no conclusive results are generated.},
  author       = {Braw, Daniel},
  keyword      = {Stock Valuation,Market Efficiency,Discounted Cash Flow,Gordon's Formula,DCF},
  language     = {eng},
  note         = {Student Paper},
  title        = {Examining the Effectiveness of Discounted Cash Flow Models},
  year         = {2010},
}