wacc Formula in Forex Trading: A Guide for Investors

5 min read

The WACC Formula, which stands for Weighted Average Cost of Capital, is an important concept in Forex trading. It attempts to measure the rate of return that a company must achieve in order to meet the cost of its debt and equity obligations. In Forex trading, the WACC formula is used to determine the price of a currency. When the cost of capital is low, the currency is usually considered as a good investment because it will appreciate in value over time. Conversely, when the cost of capital is high, this implies that the currency isn’t a good investment. Understanding how to calculate WACC can help you maximize your profits in the Forex markets.