According to @Andre_Dragosch, the cost of common equity is anchored in the Capital Asset Pricing Model, meaning investors require at least the market return referenced by the S&P 500 plus an additional markup tied to a stock’s relative volatility, described as the Equity Risk Premium, source: @Andre_Dragosch on X, Jan 13, 2026. According to @Andre_Dragosch, this required return for common equity can be relatively high versus the cost of preferred equity and debt, which is critical when assessing equity issuance pricing and expected returns, source: @Andre_Dragosch on X, Jan 13, 2026. According to @Andre_Dragosch, traders should recognize that higher-volatility common stocks must clear higher CAPM hurdle rates than preferreds and bonds, using the S&P 500 benchmark plus an ERP-based markup when evaluating offerings and valuations, source: @Andre_Dragosch on X, Jan 13, 2026.