|
|
Real Options Valuation
-
Version
3.0
The Real Option Valuation model encompasses a suite
of option pricing tools to quantify the embedded
strategic value for a range of financial analysis and
investment scenarios. Traditional discounted cash
flow investment analysis will only accept an
investment if the returns on the project exceed the
hurdle rate. While this is a worthwhile exercise, it
fails to consider the myriad of strategic options
that are associated with many investments. This model
provides the ability to identify what options might
exist in your proposal and the tools to estimate the
quantification of them. The key features of this
model include: Ease and flexibility of input, with
embedded help prompts; Informative 'Quick Start' menu
for choosing the correct tool for the situation;
Modified Black Scholes models to value the options to
delay, expand, or abandon investments; Automatic
binomial 'tree' builder model to evaluate complex
strategic options with multiple stages; Nash
equilibrium Game Theory model to evaluate market
entry strategies in a competitive environment; and
Ability to predefine historical investment and/or
industry risk profiles to utilize across models.
|