Step 2: Holding Period & Analysis Date

Investment Holding Period
This option is a sub-section item on the Discounted Cash Flow tab.

The analysis holding period can range from 5 years to 10 years. The software will automatically add an additional year for the purpose of calculating the resale value at the end of the holding period. For example, if you choose a holding period of 7 years, the software will add an 8th year to the analysis. The premise is that the future buyer will base the price on the next's years anticipated income. Note that while the resale price is based on the next year's income, it is added to the net income from the last year of the holding period and considered part of the cash flow for that year.

Note: If you shorten the holding period, cash flow projections for unused years will be set to zero, however, if the holding period is extended, the cash flows will remain at zero until explicitly projected by the analyst. 

Effective Date of Analysis
This field sets the effective date of the analysis and the starting point of the cash flow projections.