Ep241 - Aswath Damodaran | Valuation in Four Lessons

Known as the "Dean of Valuation," Aswath Damodaran is best known as the author of several widely used academic and practitioner texts on Valuation, Corporate Finance and Investment Management; he is widely quoted on the subject of valuation, with "a great reputation as a teacher and authority". His advice is a must for those wishing to gain a better understanding of investment valuation and its methods. With it, you can take the insights and advice of a recognized authority on the valuation process and immediately put them to work for you. The tools and practice of corporate valuation is intimidating to most laymen, who assume that they do not have the skills and the capability to value companies. In this talk, professor of finance Aswath Damodaran lays out four simple propositions about valuation. The first is that valuation is not an extension of accounting, insofar as it is not about recording the past but forecasting the future. The second is that valuation is not just modeling, where people put numbers into Excel spreadsheets and pump out values - a good valuation requires a narrative that binds the numbers together. The third is that valuing an asset or business is very different from pricing that asset or business, a difference that is often blurred in practice. The fourth is that luck plays a disproportionate role in whether you make money off your valuations. Put differently, you can do everything right and still walk away with nothing or worse at the end.

Visit YouTube.com/TalksatGoogle to watch the video.