2025 IAC BV - DLOM Term Structure: An Updated Model for Estimated Discounts for Lack of Marketability

Session Description

I empirically estimate a discount for lack of marketability (DLOM) term structure for restriction periods up to 10 years.  I model the multi-year DLOM by annually compounding the one-year DLOM plus a term premium over the restriction period.  I fit the model to a sample of 5,333 private equity placement implied DLOMs between 1985 and 2017.  I explain the model and illustrate how to use it to estimate an appropriate DLOM.

Speaker

John Finnerty

Continuing Education

Review of this session recording will award 1.2 CE hour. 

CPE credit is not awarded for this pre-recorded offering.