Updated Q&A on the BPM

BVWireIssue #66-3
March 19, 2008

Last week’s teleconference on “Using the Butler Pinkerton Model™ Total Cost of Equity and Public Company Specific Risk Calculator™" sparked a record number of questions—so many, that the presenters agreed to answer the overflow offline.  A free download of their comprehenisve Q&A digs even deeper into the model, covering its inputs/outputs, why and how it pulls data on closing stocks—and what the data really say, for example, when trading prices can vary so much from one day to the next. 

“When you pull stock price data for an effective date such as a Tuesday (as opposed to a Monday),” the Butler/Pinkerton developers say,  “it is much more than one more day of trading—it is actually 261 days' worth of data,” because the Calculator will pull 261 Tuesdays of closing prices.  “We think this is a neat feature of the Calculator—to be able to recognize and calculate these differences.”  Before, analysts may not have considered just how sensitive the calculation of beta might be to various inputs; commercial beta sources that provide only paper print-outs put them at the publisher’s mercy for the accuracy and sensitivity of the data.  “Here you can control your own destiny.  We believe the more information, the better.”  Look for all the new information on the Butler/Pinkerton model at BVR’s Free Downloads and also at BVMarketdata.com.
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