Amidst the ongoing debate of how to best quantify and support marketability discounts, a crucial point may be overlooked. The decrease in value caused by the discount for lack of marketability represents a market-made concession to compensate an investor for the increased risks of a less-marketable and illiquid concern. This is accomplished by investors requiring a higher rate of return.
In Using the Empirical Method for Determining DLOMs, expert Bruce Johnson leads a discussion on how this fundamental concept can be effectively put to use to empirically determine a discount for lack of marketability. As Johnson points out, "a DLOM can be supported using a rate of return methodology." Find out how and learn more about the studies he uses to objectively support the impact of the discount for lack of marketability on the rate of return in this must-attend webinar.