Market multiples">market

The user wants an encyclopedia-style article about "Market Multiples". I need to define the term, provide its history, key takeaways, formula, interpretation, example, practical applications, limitations, and a comparison with a related term. I also need to include 15 unique internal links and 4 verified external links from trusted domains, making sure they are all live and readable.

Here's my plan:

Auto-infer:
- [TERM] = Market Multiples
- [RELATED_TERM] = Discounted Cash Flow (DCF)
- [TERM_CATEGORY] = Valuation
STEP 1 — BUILD SILENT LINK_POOL: I will search for relevant and verifiable external links first, as they are the hardest constraint. Then I will generate internal links based on common financial terms that would exist on a Diversification.com website.
- External Links Search Strategy:
  - Search for "Aswath Damodaran valuation multiples" to find academic or institutional sources on valuation. (Found NYU Stern and YouTube videos, which are credible for an expert like Damodaran)
    ²⁷, ²⁸, ²⁹, ³⁰, ³¹ * Search for "history of valuation multiples" or "origin of relative valuation."
  - Search for "limitations of valuation multiples" or "criticisms of market multiples." (Found Chicago Booth on "perils of peer multiples")
    ²³, ²⁴, ²⁵, ²⁶ * Search for "practical applications of market multiples Reuters" or "market multiples investing news." (Found Reuters discussing market valuations)
    ²² * Search for "Federal Reserve Economic Letter valuation" or "FRBSF Economic Letter multiples." (Found FRBSF Economic Letters on financial markets and economic forecasts)

¹⁷, ¹⁸, ¹⁹, ²⁰, ²¹ * External Links Selection:
1. NYU Stern, Aswath Damodaran's website/materials (for definition/history/application): https://www.stern.nyu.edu/~adamodar/pc/datasets/vebitda.xls (Direct download, not ideal as a primary link, but the source l¹⁶eads to his broader data sets and teaching, which are very relevant and credible.) I will use a link to his overall academic work or a general page that discusses multiples, if available, rather than a direct Excel download. Let's refine this to a more general page about his valuation approach. The YouTube links a¹², ¹³, ¹⁴, ¹⁵re good as they are from his official channel or NYU Stern, discussing valuation. I will select one or two for citation, aiming for a stable web page link first. The direct link to datasets f¹¹rom NYU Stern is about Enterprise Value Multiples. This is a good source.
2. Federal Reserve Bank of San Francisco (FRBSF) Economic Letter (for market context/limitations): https://www.frbsf.org/economic-research/publications/economic-letter/ (General publication page, will look for specific article on valuation or market conditions). Found relevant ones like "Financial Market Conditions during Monetary Tightening" a¹⁰nd "Economic Forecasts with the Yield Curve" f⁹rom FRBSF Economic Letter. These discuss market conditions and expectations, which influence multiples. I will use one that touches on market expectations or risk premiums.
3. Reuters (for practical application/current market views): https://www.reuters.com/markets/us/least-value-weve-seen-us-equities-20-years-2024-12-02/ (YouTube video from Reuters, good for market insight).
⁸ 4. Chicago Booth (for limitations/criticisms): https://www.chicagobooth.edu/faculty/research/working-papers/perils-of-peer-effects (This is about "peer effects" which can relate to "peer multiples." The abstract mentions "The Perils of Peer Effects" and discusses econometric issues. T⁵, ⁶, ⁷his looks promising for limitations.) I will aim for the main research paper link if accessible. The NBER working paper i⁴s a good source.

*   **Internal Links (15 unique):**
    1.  [relative valuation](https://diversification.com/term/relative-valuation)
    2.  [stock valuation](https://diversification.com/term/stock-valuation)
    3.  [price-to-earnings (P/E) ratio](https://diversification.com/term/price-to-earnings-ratio)
    4.  [enterprise value (EV)](https://diversification.com/term/enterprise-value)
    5.  [EBITDA](https://diversification.com/term/ebitda)
    6.  [revenue](https://diversification.com/term/revenue)
    7.  [cash flow](https://diversification.com/term/cash-flow)
    8.  [discounted cash flow (DCF)](https://diversification.com/term/discounted-cash-flow)
    9.  [intrinsic value](https://diversification.com/term/intrinsic-value)
    10. [industry averages](https://diversification.com/term/industry-averages)
    11. [market capitalization](https://diversification.com/term/market-capitalization)
    12. [earnings per share (EPS)](https://diversification.com/term/earnings-per-share)
    13. [asset valuation](https://diversification.com/term/asset-valuation)
    14. [book value](https://diversification.com/term/book-value)
    15. [financial ratios](https://diversification.com/term/financial-ratios)

3. STEP 2 — WRITE THE ARTICLE: I will structure the article according to the provided headings, integrating the internal and external links naturally. I will ensure all constraints are met, including word count, tone, and forbidden phrases.

(Self-correction during writing):

Ensure [TERM] (Market Multiples) is used at least four times.
Make sure all 15 internal links are unique and used exactly once.
Verify the 4 external links are live and from appropriate domains.
Check that [TERM_CATEGORY] (Valuation) is naturally introduced.
For the formula section, confirm if a general formula for "Market Multiples" is appropriate or if it's more about specific ratios. Market multiples are a category of ratios, so I'll discuss the general concept of their calculation rather than a single formula. I will focus on defining variables within the context of common multiples.
For the "Limitations" section, the Chicago Booth paper on "peer effects" is relevant for the limitations of using peer multiples without accounting for underlying factors.
For the comparison, I will clearly differentiate Market Multiples from Discounted Cash Flow (DCF).

Let's start building the LINK_POOL first and then the article.

LINK_POOL (Hidden for final output):

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