Which security types are typically easier to value?

Listed shares and residential property are considered easier to value due to their characteristics and the availability of market data. Listed shares, for example, are traded on stock exchanges where their prices are continuously updated and widely available, allowing for real-time valuation based on supply and demand dynamics, trading volumes, and company performance indicators. Valuation methods like price-to-earnings ratios, discounted cash flow analysis, and comparable company analysis are readily applicable to listed shares due to this availability of public information.

Similarly, residential property valuations are generally streamlined due to the abundance of comparable sales data, appraisal techniques, and established market standards. There are often numerous properties similar in type, location, and condition that can be analyzed to arrive at a reliable valuation. Real estate professionals can use recent sale prices of similar homes (comparables), income approach for rental properties, and the cost approach to assess market value.

In contrast, commodities and futures are subject to significant price volatility and can be influenced by a range of factors such as geopolitical events, weather conditions, and market speculation, making their valuation complex. Private equity and startups also present challenges in valuation due to their reliance on future projections, lack of market comparables, and the uncertainty surrounding their business models, which often result in varied valuations