The Research on SME's Equity Value with Stochastic Pricing Method

DOI

10.2991/rac-16.2016.96How to use a DOI?

Keywords

SME; equity value; stochastic process; Monte Carlo simulation

Abstract

Abstract:in order to value the equity of SME effectively, we modify the traditional DCF model, namely, we use stochastic variable to describe the factors which have direct impact on cash-in and cash-out; then we use stochastic equation to portray the change of equity valuation; finally, we will simulate the the change of equity valuation within some periods by Monte Carlo simulation. In accordance with the result coming from the simulation ,we find that there exists a big probability that the company will bankrupt, however, their growth speed is extremely high and potential value is decent , which rightly fit the realistic situation. therefore, this modified method has ,to some extent, reference value in valuing the equity of SME

Copyright

© 2016, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Changbing Yang
AU  - Mu Zhang
PY  - 2016/11
DA  - 2016/11
TI  - The Research on SME's Equity Value with Stochastic Pricing Method
BT  - Proceedings of the 7th Annual Meeting of Risk Analysis Council of China Association for Disaster Prevention
PB  - Atlantis Press
SP  - 594
EP  - 599
SN  - 1951-6851
UR  - https://doi.org/10.2991/rac-16.2016.96
DO  - 10.2991/rac-16.2016.96
ID  - Yang2016/11
ER  -