The cost of capital is to be used as the discount rate when discounting cash flows relevant for valuation purposes. Determining the cost of capital is therefore a material component of company valuations. Valuation standard IDW S1 explicitly refers to the capital markets-based Capital Asset Pricing Model (CAPM or Tax CAPM) for purposes of determining cost of capital on the basis of which cost of capital may fundamentally be broken down into a base interest rate, a beta factor and a market risk premium. In this context, beta represents company-specific risk and measures price fluctuations in the single position (single position risk) compared to the market (market risk). The beta factor is determined based on a linear regression of yields. In practice, this regularly places the appraiser before a challenge: In the case of privately-held enterprises, this must be determined based on yields of suitable listed companies (“peer group”). In addition, “unlevering” and “relevering” are used to make adjustments to reflect the actual financing situation of the company being valued. The choice of peer group companies and the proper beta calculation are a constant point of discussion in cases before the courts. We determine peer groups, beta factors and cost of capital for your valuation.