I do favor protecting your brand. Just don't expect this to increase traffic.
If it is a generic name, getting similar .coms makes sense from a traffic standpoint, IF they are type-in domains. If not, again, it only makes sense in order to protect your brand. For example, you might want both plural and non-plural versions.
In the current market some people argue for domain values based upon the domain name's type-in traffic earnings. They argue for the use of a multiple of those earnings: $$$ a year Xs # years.
That's one approach amongst many.
I think another metric would be the conversion value for a domain that delivers sales/customer leads to an end user/consumer of the traffic that a domain name delivers. In other words, if you own a domain that delivers customer leads for a product that sells for $100,000 with a $25,000 profit it might be worth a bit more than it would if you looked at the PPC revenue.
I suggest you take a look in the Domain Forum Library as there are several very good guideline threads for valuing domains, negotiating aftermarket purchases, etc.
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[edited by: Webwork at 3:23 pm (utc) on Dec. 3, 2006]
If you were to ask any 10 experienced domainers, those of us in the trade for 7-10 years, you would get a range of values - not a fixed value - and based upon niche experience or valuation model even those values might vary by 100-300%.
As a "fast and dirty" approach to getting an idea of values you might read the reports of domain sales at DNJournal to get some idea of recent sales prices.
Take a look at these threads in the Domain Forum Library:
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Sorry but I don't have the time to code the links with titles. They mostly relate to issues connected with your questions, directly and indirectly.
[edited by: Webwork at 3:48 pm (utc) on Dec. 3, 2006]
There are formulas, and there are factors, but it all comes down to domains are a highly illiquid market where motivations and prices vary widely.
If you are acquiring a domain name for traffic, then first verify the traffic, and then determine the value of that traffic to you.
Unless you are acquiring a very popular keyword, or a domain with an existing site with traffic, I am dubious about the notion of using additional domain names to generate traffic for a legitimate content-based web site. There are almost certainly better and easier ways of developing more traffic.
If there is some logical reason for your site to have more than one name, or to break your content up into multiple sites, then do it. "Acquiring more traffic" just doesn't seem a good reason for additional domain names.
Unless your business is domain parking or arbitrage.