AG.UN.CN WACC - Weighted Average Cost of Capital

The WACC of Arctic Glacier Income Fund (AG.UN.CN) is 6.0%.

The Cost of Equity of Arctic Glacier Income Fund (AG.UN.CN) is 184.45%.

The Cost of Debt of Arctic Glacier Income Fund (AG.UN.CN) is 5.00%.

	Range	Selected
Cost of equity	139.80% - 229.10%	184.45%
Tax rate	8.30% - 11.30%	9.80%
Cost of debt	5.00% - 5.00%	5.00%
WACC	5.7% - 6.3%	6.0%

WACC

AG.UN.CN WACC calculation

Category	Low	High

Long-term bond rate	3.2%	3.7%
Equity market risk premium	4.6%	5.6%
Adjusted beta	29.71	40.17

Additional risk adjustments	0.0%	0.5%
Cost of equity	139.80%	229.10%

Tax rate	8.30%	11.30%
Debt/Equity ratio	121.42	121.42
Cost of debt	5.00%	5.00%

After-tax WACC	5.7%	6.3%


Selected WACC	6.0%

AG.UN.CN's CAPM model and how its cost of Equity is calculated

The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.

This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.

Here’s how we figure out the cost of equity for AG.UN.CN:

cost_of_equity (184.45%) = risk_free_rate (3.45%) + equity_risk_premium (5.10%) * adjusted_beta (29.71) + risk_adjustments (0.25%)

We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.