Delayed Perpetuity

外汇网2021-06-19 13:52:47 36

A perpetual stream of cash flows that start at a pdetermined date in the future. For example, pferred fixed pidend paying shares are often valued using a perpetuity formula. If the pidends are going to originate (start) 5 years from now, rather than next year, the stream of cash flows would be considered a delayed perpetuity.

The net psent value (NPV) of a delayed perpetuity is less than a comparable ordinary perpetuity because, based on time value of money principles, the payments have to be discounted to account for the delay. Retirement products are often structured as delayed perpetuities.

标签：