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What model does privateMetrics® use to estimate asset prices?

Answer

privateMetrics uses a factor model approach to estimate asset prices. The factor models are calibrated with actual arm’s length transactions of equity stakes in private companies. Our factor models can accommodate time-varying factor prices, thus simulating closely the price formation behavior in private markets. For example, a company with the same characteristics can be estimated at a higher valuation, after a similar company is taken private in an expensive transaction, and vice versa.

Further Reading

You can read more about our modelling in our Private Equity valuation white paper.

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