Distance to the Default in Financial Accounting Formulas

Distance to the Default is a financial metric that measures how far a company’s current value (assets) is from its default point (liabilities). And is denoted by DD.

Formulas to find Distance to the Default in Financial Accounting

fxMerton ModelGo

List of variables in Financial Accounting formulas

fx Market Value of Company Assets Go

fx Market Value of Company Debt Go

fx Risk Free Interest Rate Go

fx Volatility of Company Asset Value Go

fx Time to Maturity Go

FAQ

What is the Distance to the Default?

Distance to the Default is a financial metric that measures how far a company’s current value (assets) is from its default point (liabilities).

Can the Distance to the Default be negative?

{YesorNo}, the Distance to the Default, measured in {OutputVariableMeasurementName} {CanorCannot} be negative.

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