In the valuation process for estimating the intrinsic value of an asset, which step involves determining the required rate of return for each cash flow based on its riskiness and considering the opportunity cost using the required rate of return?

Step $1$: Identifying the cash flows associated with the asset

Step $2$: Forecasting the future cash flows

Step $3$: Discounting the future cash flows to present value

Step $4$: Adjusting the present value for any unique characteristics of the asset

Step $5$: Determining the required rate of return based on the asset's opportunity cost