EWI.L
Edinburgh Worldwide Investment Trust PLC
Price:  
175.60 
GBP
Volume:  
631,940.00
United Kingdom | N/A
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EWI.L WACC - Weighted Average Cost of Capital

The WACC of Edinburgh Worldwide Investment Trust PLC (EWI.L) is 11.0%.

The Cost of Equity of Edinburgh Worldwide Investment Trust PLC (EWI.L) is 11.95%.
The Cost of Debt of Edinburgh Worldwide Investment Trust PLC (EWI.L) is 4.45%.

Range Selected
Cost of equity 10.30% - 13.60% 11.95%
Tax rate -% - -% -%
Cost of debt 4.20% - 4.70% 4.45%
WACC 9.5% - 12.4% 11.0%
WACC

EWI.L WACC calculation

Category Low High
Long-term bond rate 4.0% 4.5%
Equity market risk premium 6.0% 7.0%
Adjusted beta 1.06 1.24
Additional risk adjustments 0.0% 0.5%
Cost of equity 10.30% 13.60%
Tax rate -% -%
Debt/Equity ratio 0.15 0.15
Cost of debt 4.20% 4.70%
After-tax WACC 9.5% 12.4%
Selected WACC 11.0%

EWI.L'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 EWI.L:

cost_of_equity (11.95%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.06) + 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.