The Efficient Markets Hypothesis(EMH) hypothesizes that stocks are always in equilibrium and that it is impossible for an investor to consistently “ beat the market.” On a norm, this theory advocates that stocks in general are neither overvalued nor undervalued namely they are fairly priced and in equilibrium. There are several degrees of EMH namely: [...]
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There are three approaches in valuing a company :income, market and asset. Income Approach The income approach is the most appropriate method for valuing an on-going company. An investment in any asset is worth no more than the present value of its expected future cashflow, which can be in the form of earnings, dividends or free [...]
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