JFJ.L WACC - Weighted Average Cost of Capital

The WACC of JPMorgan Japanese Investment Trust PLC (JFJ.L) is 11.2%.

The Cost of Equity of JPMorgan Japanese Investment Trust PLC (JFJ.L) is 12.10%.

The Cost of Debt of JPMorgan Japanese Investment Trust PLC (JFJ.L) is 4.30%.

	Range	Selected
Cost of equity	10.60% - 13.60%	12.10%
Tax rate	0.60% - 0.90%	0.75%
Cost of debt	4.00% - 4.60%	4.30%
WACC	9.8% - 12.5%	11.2%

WACC

JFJ.L WACC calculation

Category	Low	High

Long-term bond rate	4.0%	4.5%
Equity market risk premium	6.0%	7.0%
Adjusted beta	1.1	1.23

Additional risk adjustments	0.0%	0.5%
Cost of equity	10.60%	13.60%

Tax rate	0.60%	0.90%
Debt/Equity ratio	0.13	0.13
Cost of debt	4.00%	4.60%

After-tax WACC	9.8%	12.5%


Selected WACC	11.2%

JFJ.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 JFJ.L:

cost_of_equity (12.10%) = risk_free_rate (4.25%) + equity_risk_premium (6.50%) * adjusted_beta (1.1) + 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.