Real Options Valuation 3.2
The Real Option Valuation template combines a set 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 cost of capital rate. This is a worthwhile exercise as input for valuing real options; however it ignores any strategic options that are commonly associated with many investment decisions. Real option valuation provides the ability to identify what options might exist in a business proposal and the tools to estimate the quantification of them. The real option valuation template combines ease and flexibility of input with embedded help prompts to assist with selecting the correct option valuation model for the investment decision. Modified Black Scholes option pricing models are provided to value the options to delay, expand or abandon proposed of existing business streams or investments. An unlimited branch binomial tree builder model can 歡迎登陸 Real Options Valuation 網站 be employed to evaluate complex strategic options with multiple stages. The Nash equilibrium Game Theory option model evaluates market entry strategies in a competitive environment with clear results on whether to lead, follow or enter the market simultaneously with competitors. Historical investment and/or industry risk profiles can be utilized across real option valuation models as a proxy of risk for the analyzed investment. The Real Option Valuation template is compatible with Excel 97-2013 for Windows and Excel 2011 or 2004 for Mac as a cross platform real options valuation solution.
Overview
Real Options Valuation is a Shareware software in the category Business developed by Business Spreadsheets.
The latest version of Real Options Valuation is 3.2, released on 09/05/2016. It was initially added to our database on 04/11/2012.
Real Options Valuation
Real options valuation, also often termed real options analysis, (ROV or ROA) applies option valuation techniques to capital budgeting decisions. A real option itself, is the right — but not the obligation — to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project. For example, the opportunity to invest in the expansion of a firm's factory, or alternatively to sell the factory, is a real call or put option, respectively. Real options are generally distinguished from conventional financial options in that they are not typically traded as securities, and do not usually involve decisions on an underlying asset that is traded as a financial security.
Real options analysis, as a discipline, extends from its application in corporate finance, to decision making under uncertainty in general, adapting the techniques developed for financial options to "real-life" decisions. For example, R&D managers can use Real Options Valuation to help them allocate their R&D budget among diverse projects; a non business example might be the decision to join the work force, or rather, to forgo several years of income to attend graduate school. It thus forces decision makers to be explicit about the assumptions underlying their projections, and for this reason ROV is increasingly employed 歡迎登陸 Real Options Valuation 網站 as a tool in business strategy formulation.
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Real Options Valuation - History
. investment decisions for centuries, the term "real option" is relatively new, and was coined by Professor Stewart Myers of the MIT Sloan School of Management in 1977 . It is interesting to note though, that in 1930, Irving Fisher wrote explicitly of the "options" available to a business owner (歡迎登陸 Real Options Valuation 網站 The Theory of Interest, II.VIII) . The description of such opportunities as "real options", however, followed on the development of analytical techniques for financial options, such as Black–Scholes in 1973 .
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—D.H. (David Herbert)
Real Options Valuation
The Real Option Valuation template provides a set of option pricing tools to quantify the embedded strategic value for a range of financial analysis and investment scenarios. Option pricing models include Black-Scholes, Binomial, and Game Theory.
Real Options Valuation Screenshot
Version: 3.2
License: Free To Try $26.00
Operating 歡迎登陸 Real Options Valuation 網站 System: Windows
Homepage: www.business-spreadsheets.com
Developed by: Business Spreadsheets
The Real 歡迎登陸 Real Options Valuation 網站 Option Valuation template combines a set of option pricing tools to quantify the embedded strategic value for a range of financial analysis and investment 歡迎登陸 Real Options Valuation 網站 scenarios.
Traditional discounted cash flow investment analysis will only accept an investment if the returns on the project exceed the hurdle cost of capital rate. This is a worthwhile exercise as input for valuing real options; however it ignores any strategic options that are commonly associated with many 歡迎登陸 Real Options Valuation 網站 investment decisions.
Real option valuation provides the ability to identify what options might exist in a business proposal and the tools to estimate the quantification of them. The real option valuation template combines ease and flexibility of input with embedded help prompts to assist with selecting the correct option valuation model for the investment decision.
Modified Black Scholes option pricing models are provided to value the options to delay, expand or abandon proposed of existing business streams or investments. An unlimited branch binomial tree builder model can be employed to evaluate complex strategic options with multiple stages.
The Nash equilibrium Game Theory option model evaluates market entry strategies in a competitive environment with clear results on whether to lead, follow or enter the market simultaneously with competitors. Historical investment and / or industry risk profiles can be utilized across real option valuation models as a proxy of risk for the analyzed investment.
The Real Option Valuation template is compatible with Excel 97-2013 for Windows and Excel 2011 or 2004 for 歡迎登陸 Real Options Valuation 網站 歡迎登陸 Real Options Valuation 網站 Mac as a cross platform real options valuation solution.
Version 3.2: Compatible with Microsoft Excel 2016 for Windows and Mac
Real Options Valuation
Real options 歡迎登陸 Real Options Valuation 網站 valuation, also often termed real options analysis, (ROV or ROA) applies option 歡迎登陸 Real Options Valuation 網站 valuation techniques to capital budgeting decisions. A real option itself, is the right — but not the obligation — to undertake certain business initiatives, such as deferring, abandoning, expanding, staging, or contracting a capital investment project. For example, the opportunity to invest in the expansion of a firm's factory, or alternatively to sell the factory, is a real call or put option, respectively. Real options are generally distinguished from conventional financial options in that they are not typically traded as securities, and do not usually involve decisions on an underlying asset that is traded as a financial security.
Real options analysis, as a discipline, extends from its application in corporate finance, to decision making under uncertainty in general, adapting the techniques developed for financial options to "real-life" decisions. For example, R&D managers can use Real Options Valuation to help them allocate their R&D budget among diverse projects; a non business example might be the decision to join the work force, or rather, to forgo several years of income to attend graduate school. It thus forces decision makers to be explicit about the assumptions underlying their projections, and for this reason ROV is increasingly employed as a tool in business strategy formulation.
Famous quotes containing the word real :
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—Jimmy Carter (James Earl Carter, Jr.)