n NISM Certifications
X NISM Series X
Medium

Relative valuation involves valuing a firm or asset using multiples of established parameters, such as P/E ratio or EV/EBITDA, to compare with similar companies or assets, providing a market-based benchmark for valuation.

Practice question from NISM Series XIX A- Alternative Investments Funds (AIF) Distributors Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Discounting the relative cash flow

  2. Valuing with multiples of established parameters

    Correct answer

  3. C

    Finding the comparable cash flow

  4. D

    Valuation based on common P/E ratio

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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