Editorial Type:
Article Category: Research Article
| Online Publication Date: 01 Jul 2016
The Size Effect—It Is Still Relevant
The Size Effect—It Is Still Relevant
FASA
Page Range: 62 – 71
Practitioners commonly incorporate a size premium when developing their cost of capital estimates using the modified capital asset pricing model (MCAPM). This article is intended to correct common misconceptions about the size premium and demonstrate that data from recent periods support the continued use of a size premium.
Copyright: © 2016, American Society of Appraisers
Contributor Notes
Roger J. Grabowski, FASA, is Managing Director with Duff & Phelps in their Chicago office.