Securities Lending Strategies, Valuation of Term Loans Using Option Theory (Presentation Slides)

We propose a possible alternative to WACC as cost of capital for a business investment decision through option theory. The cost of capital in this new definition becomes forward-looking and easy to compute with traded market information as inputs. More importantly, it is a fair value- based approach and does not depend on investors’ own expectation. An important parameter “asset characteristic value” is identified and its role is further illustrated by using Merton’s capital structure model. Asset characteristic value can be calibrated by using stock price or credit spread observed from a secondary market.

Download Full-text

An Analytical Theory of Project Investment: A Comparison with Real Option Theory

SSRN Electronic Journal ◽

10.2139/ssrn.336380 ◽

2002 ◽

Cited By ~ 1

Author(s):

Jing Chen

Keyword(s):

Real Option ◽

Analytical Theory ◽

Project Investment ◽

Real Option Theory ◽

Option Theory

Download Full-text

A Critical Study on Karl Rahner’s Fundamental Option Theory

The Catholic Theology ◽

10.36515/ctak..31.201712.167 ◽

2017 ◽

Vol null (31) ◽

pp. 167-219

Author(s):

김상용

Keyword(s):

Critical Study ◽

Option Theory

Download Full-text

Media multiplicity and collaborative innovation with suppliers: evidence from China

European Journal of Innovation Management ◽

10.1108/ejim-04-2021-0179 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Ruihong Liu ◽

Yuanqiong He ◽

Xiu-Hao Ding ◽

Jianhong Li

Keyword(s):

Real Option ◽

Communication Media ◽

National Bureau ◽

Content Type ◽

Real Option Theory ◽

Collaborative Innovation ◽

Using Data ◽

Option Theory ◽

Enterprise Survey

PurposeBased on media choice theories and real option theory, this study aims to explore the role of communication media portfolio in achieving collaborative innovation with suppliers.Design/methodology/approachUsing data of the Study of Competitiveness, Technology and Firm Linkages 2002 collected by the World Bank and the Enterprise Survey Organization of the Chinese National Bureau of Statistics, this study employed logit model to test the hypotheses. Moreover, some robustness analyses were conducted.FindingsThis study suggests that media multiplicity increases the probability for a firm to achieve collaborative innovation with suppliers on the basis of real option theory. Furthermore, distance from the suppliers and relationship formality make media multiplicity further important in collaborative innovation with suppliers.Originality/valueThrough investing how communication media portfolio affecting collaborative innovation with suppliers and the contingency factors, this study complements existing studies just concentrating on supplier capabilities, relationships with suppliers and characteristics of supplier network. Moreover, this study contributes in the information system field by exploring the role of media portfolio rather than individual media.

Download Full-text