1. bookTom 26 (2018): Zeszyt 1 (March 2018)
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License
Format
Czasopismo
eISSN
2300-5289
Pierwsze wydanie
16 May 2013
Częstotliwość wydawania
4 razy w roku
Języki
Angielski
access type Otwarty dostęp

The Transactional Assets Pricing Approach and Income Capitalization Models in Professional Valuation: Towards a “Quick” Income Capitalization Format

Data publikacji: 16 Apr 2018
Tom & Zeszyt: Tom 26 (2018) - Zeszyt 1 (March 2018)
Zakres stron: 89 - 107
Informacje o czasopiśmie
License
Format
Czasopismo
eISSN
2300-5289
Pierwsze wydanie
16 May 2013
Częstotliwość wydawania
4 razy w roku
Języki
Angielski
Abstract

The transactional assets pricing approach within valuation theory (TAPA) reviewed in this paper and developed by the authors, now more than a decade ago (MICHALETZ, ARTEMENKOV A. & ARTEMENKOV L., (2007), has found many applications in professional valuation practices dealing with illiquid assets (Leyfer 2006; Andrews 2011)). Consequently, challenges have arisen to ascertain its performance and develop tools, on its basis, which can be employed by valuers in their everyday practice and which are aligned as much as possible with the income approach tools used by them in their professional work. This paper proposes modifications to the standard direct income capitalization technique to align it as closely as possible with the results derivable under the applications of the TAPA basic pricing formula. The authors develop the respective adjustments using the Taylor series expansion and then, using a simulation technique, outline the performance of the resulting modified (“quick”) income capitalization model against the TAPA benchmark. The findings indicate that such a modified (“quick”) income capitalization approach has reasonable accuracy, which makes it amenable to direct usage in valuation practice, given the described assumptions.

Keywords

JEL Classification

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