WWW.THESES.XLIBX.INFO
FREE ELECTRONIC LIBRARY - Theses, dissertations, documentation
 
<< HOME
CONTACTS



Pages:     | 1 |   ...   | 32 | 33 || 35 | 36 |   ...   | 156 |

«VOLUM E 1 1, N UM B E R 1 I S SN 2 1 6 8 - 0 6 1 2 F L ASH DR I V E I S SN 1 9 4 1 - 9 5 8 9 ON L I N E T h e In s t it ut e f o r Bu s i n e s s an ...»

-- [ Page 34 ] --

Miller Moya, Luis (2004) “Acción colectiva y modelos de racionalidad”, Revista Estudios Fronterizos, vol. 5, Nº 9, pp. 107-130, Universidad de Baja California, México.

Nocera, pablo (2006) “La fotografía como metáfora en el pensamiento de Gabriel Tarde”, Nómadas.

Revista crítica de Ciencias Sociales y Jurídicas, Nº 14, editado por Universidad Complutense de Madrid, España.

Paricio, J. (2007). Implicaciones del paso de la docencia centrada en contenidos a la docencia centrada en competencias. En VIII Foro Aneca: ¿Es posible Bolonia con nuestra actual cultura pedagógica? Propuesta para el cambio, 25-29. Madrid: Aneca.

Pétriz, F. (2007). Estrategias para el cambio metodológico en la universidad española. La Cuestión Universitaria, 2. Recuperado de http://www.lacuestionuniversitaria.upm.es/web/articulo.php?id_articulo=14 Plata, Leobardo y Mejía, Indalecio (2012) ¿Racionalidad clásica o racionalidad limitada? Presentado en el XVI Jornadas de Epistemología de la Economía, Facultad de Ciencias Económicas, Universidad de Buenos Aires.

Scarano, Eduardo (208) “La teoría estándar de la racionalidad: Perspectivas metodológicas”, Revista Economía, Nº XXXIII, pp. 63-92.

Stanovich, K. (2006) The Robot Rebellion. Finding Meaning in the Age of Darwin, The University Chicago Express, Chicago, EEUU.

Stanovich, Keith y West, Richard (2000) “Individual differences in reasoning: Implication for the rationality debate?” Behavioral and brain sciences, Nº 23, pp. 645-665, Cambridge University Press.

GCBF ♦ Vol. 11 ♦ No. 1 ♦ 2016 ♦ ISSN 1941-9589 ONLINE & ISSN 2168-0612 USB Flash Drive 166 Global Conference on Business and Finance Proceedings ♦ Volume 11 ♦ Number 1 Stanovich, Keith y West, Richard (2003) “Evolutionary versus instrumental goaos: How evolutionary psychology misconceives human rationality” en Evolution and the Psychology of Thinking: The Debate;

East Sussex: Psychological Press.

Torrego, L. (2004). Ser profesor universitario, ¿un reto en el contexto de convergencia europea? Un recorrido por declaraciones y comunicados. Revista Interuniversitaria de Formación del Profesorado, 18(3), 259-268.

Tünnermann, C. (1998). La educación superior en el umbral del siglo XXI (2 ed.). IESALC/UNESCO.

Tversky, Amos y Kahneman, Daniel (1981) “The Framing of Decisions and the Psychology of Choice”, Science, New Series, Vol. 211, Nº 4481, pp. 453-458.

Vidal de la Rosa, Godofredo (2008) “La Teoría de la Elección Racional en las ciencias sociales”, Sociológica, año 23, Nº 67, pp. 221-236, México.

Vieira Cano, Mayra (2008) “Nuevos paradigmas del pensamiento económico: un llamado a la interdisciplinariedad”, Revista Ciencias Estratégicas, Vol. 16, Nº 20, pp. 335-350, Universidad Pontificia Bolivariana, ISSN 1794-8347, Colombia.

Villa, A. (2006). El proceso de convergencia europeo y el papel del profesorado. Foro de educación, 7, 103-117.

Villa, A. y Villa, O. (2007). El aprendizaje basado en competencias y el desarrollo de la dimensión social en las universidades. Educar 40, 15-48.

Vivar, J. (1971). Principios y tareas de la universidad. Ecuador: Universidad de Loja.

Wilczenski, F. L. y Coomey, S. M. (2007). A practical guide to service learning: Strategies for positive development in schools. New York, NY: Springer.

Zabalza, M. (2006). La convergencia como oportunidad para mejorar la docencia universitaria. Revista inter-universitaria de formación del profesorado, 20(3), 37-69.

BIOGRAPHY

Mario Luis Perossa is Masters in Finance from National University of Rosario, Accountant and Bachelor in Business Administration from the University of Buenos Aires. Professor at the University Maimonides Financial Management Course. He can be reached at the Department of Finance Research, CEJU of Maimonides University, Hidalgo Street 750, Buenos Aires.

Elena Alejandra Marinaro is Masters in Business Administration from the Universidad del Salvador and the University of Deusto, Accountant from the University of Salvador. Academic Secretary and Director of the International School of Business at the University Maimonides. She can be contacted at the School of International Business at the University Maimonides, Hidalgo Street 750, Buenos Aires.

GCBF ♦ Vol. 11 ♦ No. 1 ♦ 2016 ♦ ISSN 1941-9589 ONLINE & ISSN 2168-0612 USB Flash Drive 167 Global Conference on Business and Finance Proceedings ♦ Volume 11 ♦ Number 1

PROSPECTS OF REAL OPTIONS USE IN INVESTMENT

PROJECT VALUATION IN BANKS

Khaliun Ganbat, Plekhanov Russian University of Economics

–  –  –

This article discusses the necessity of bank managers to evaluate investment projects with real options. The object of study is the investment activity of banks, and the subject is optimization of investment projects valuation method in the framework of banks risk management. The main objective of the study is to develop an optimal methodology for the investment project valuation that will enable the effective management of bank funds and obtain sufficient investment income. While studying the problem, there were set following tasks to solve: Analyze investment project valuation methods and ways of their optimization; Identify opportunities of using real options in the valuation of investment projects in bank; Make own conclusions on the studied subject. The relevance of the chosen topic is determined by the necessity of optimal risk management tools and definitions in assessment methods of the investment project. The use of real options is one of the innovative approaches to the valuation of assets. Traditional methods of valuating investment projects are not taken into account when calculating the competitive advantage and flexibility in management. Moreover, bank managers face the uncertainty at the beginning and in further development of the project that forces managers to use more flexible tools for assessing the investment project. As the result of this topics study there arises a question to consider for the heads of the bank about including real option method in its activity. The use of this method is one of the innovative methods in evaluating investment projects and will let managers of the bank to be more flexible.





JEL: G00 KEYWORDS: Investment project, investment project valuation, real option, banks, risk-management.

The investment activity of commercial banks, along with its classic operations, such as loans, plays a significant role in the formation of bank assets. These operations are aimed at the formation of the trading portfolio in order to obtain speculative and investment income, investments in securities and shares of organizations for the purpose of joint commercial activities as well as investing in the project, which is significantly important area for the success of the bank.

At the present time methods of valuation of investment projects in banks are limited. The market is characterized by high uncertainty, which leads to the importance of qualified evaluation. Therefore, there is need to expand the system of assessment methods that would reduce the risk of loss of funds for the bank and for the companies that are the creators of the project. These tools include real options method, which was proposed by a number of foreign authors in the mid-1980s, which began to put into practice since 1990s (Mostly in oil and mining companies.) The main feature of this method is the fact that it fits into a rapidly changing economic environment. In Russia, for example, there are not many authors who do a research about this method, and especially its application in banks. The monograph of Russian economist Gusev A. A., which was released in 2009 considering the full range of real options in valuation of business and investment based on the number of foreign authors [1]. In this work he shows the necessity and importance of real option method for the company, but didn’t pay attention on its application in banks.

There were numerous articles published by authors such as Abramov G. F., Bulgakov L.G., Grishina S. A., from which it’s clear that Russia, for example, has an increasing interest in this issue every year, although the degree of scrutiny is rather small. Abramov G. F. gave the definition of real option in his article, its difference from a financial option and the method of investment projects evaluation with real options. While Bulgakov L. G. studied the possibility of banks participation in financing investment projects. Comparative GCBF ♦ Vol. 11 ♦ No. 1 ♦ 2016 ♦ ISSN 1941-9589 ONLINE & ISSN 2168-0612 USB Flash Drive 168 Global Conference on Business and Finance Proceedings ♦ Volume 11 ♦ Number 1 analysis between the traditional method of project appraisal and real options method held in the work of Grishina S. A., but it does not show possible applications, in particular in banks [2]. Thus, the extent of studying this topic is relatively small and the application of real option method is not used in the banks investment project evaluation.

projects. Traditional methods of evaluation of investment projects, based on discounted cash flows, which

have some disadvantages:

Assume that managers decisions immutable;

Do not consider the possibility of changes in managers decision in several periods of time;

Do not count the period in which the investment opportunity is retained; the uncertainty of future cash flows, the yield of securities; the cost depreciation during the term of the option.

But the use of real options can solve the problems above. This method is an alternative view of the investment analysis and projects evaluation in the present economic condition.

Figure. 1. A comparative illustration of the factors considered in the NPV (net present value) and the value of real option [3]

–  –  –

Traditional approaches of project evaluation are based on the applicable accounting approach and a stable market situation, but in today's fast-growing market with a high degree of uncertainty it is preferable to use real options. Generally real option gives the right but not the obligation, to its owner to commit various types of management decisions in the future. If a financial option is usually the right to purchase/sale of financial assets, such as stocks, bonds and to hedge financial risks, the real options allow you to change the course of the project and to insure against strategic risks.

GCBF ♦ Vol. 11 ♦ No. 1 ♦ 2016 ♦ ISSN 1941-9589 ONLINE & ISSN 2168-0612 USB Flash Drive 169 Global Conference on Business and Finance Proceedings ♦ Volume 11 ♦ Number 1 Although, there are two different methods NPV and real options, these methods are not isolated from each other. On the contrary, the practical application of the theory of real options based on traditional instruments of discounted cash flows and they are used in more effective assessment of the investment.

In general, main risks of financing investment projects are (Risks that are specific for the project):

Market risk, which is defined as the risk of shortfall in the planned profit due to low sales and prices of goods. The main reasons are the rejection of a new product by the market or just too optimistic assessment of sales due to incorrect valuation of the competitiveness of goods and misuse of pricing. Moreover there may be errors in positioning and product promotion policy, in other words the wrong way of promotion can lead to this kind of risk;

The risk of exceeding the project budget and non-compliance with schedule, which leads to an increase in payback period of the project. The causes of this risk can be objective, such as changes in legislation and be subjective, which is associated with a lack of study and work on the inconsistency of the project;

General economic risks, including all external risks affecting the project and the bank, such as currency risk and interest rate risk, increase or decrease in inflation and the risk of increased competition in the industry [4].

The main advantage of the project evaluation with real options is that it accounts the degree of uncertainty and the retention period of investment opportunities, as well as reducing these risks and provides an opportunity to change the course of the project upon the occurrence of general economic risks.

The following example shows the effect of uncertainty on the value of option.

Bank A invests in a completely new project of organic products production and create the possibility of release after 2 years. If competition in the market will increase by the time of the investment, the rate of NPV (net present value) of the draft can become negative (Meaning that cash flow may decline from the planned value.) And then there is a dispute about whether to continue to invest, if increased competition

–  –  –

Where Ct - the expected cash flow for the period of time t;

k - the discount rate based on risk.

For example, the expected probability of NPV = 5 million USD is 0.5 and the expected probability that NPV = - 5 million USD is also 0.5.

Hence, the average weighted NPV = (5 × 0.5) + (0.5 × (-5)) = 0.

At this stage Bank stops its investment and the project is over. But this decision is not correct, because it does not take into account the fact of the possibility of project management choice. For example, if the projected NPV becomes negative, the management may refuse financing the project and reduce the NPV to zero.

0.5 × 5 + 0.5 × 0 = 2.5 million.

Obviously, the choice has certain cost. In this case, the expected value of real option will be 2.5 million dollars. The correct solution to this situation would be a continuation of investments in the project as long as the total amount does not exceed $ 5 million.



Pages:     | 1 |   ...   | 32 | 33 || 35 | 36 |   ...   | 156 |


Similar works:

«Certificare si conectare CUPRINS 1. Sfaturi pentru securitatea pe internet 1.1 Cum te protejam noi? 1.1.1 Criptarea informatiei 1.1.2 Acces limitat prin firewall 1.1.3 Inchiderea automata a sesiunii 1.2 Ce poti tu face pentru a te proteja? 1.2.1 Protectia parolei 1.2.2 Protectia calculatorului 2. Conectare prin SMS 2.1 Introducerea datelor de conectare (credentiale) 2.2 Introducerea eronata a userului sau a parolei 3. Certificate digitale 3.1 Cerere Certificat 3.2 Instalarea Certificatului 3.3...»

«AC/4661A March 2015 Contribution of the Dutch social partners to the National Reform Programme within the context of the EU 2020 Strategy Foreword The EU 2020 Strategy, which the European Union (EU) agreed in 2010, focuses on the promotion of sustainable, inclusive and smart growth, i.e. growth that is driven by knowledge and innovation. The aim of this strategy is for the EU to emerge from the economic crisis stronger and to achieve a high level of employment, social cohesion and productivity....»

«hertz furgonetas hertz furgonetas Hertz hertz.de Aktionspreise! Unlimitierte KM, Diebstahlschutz Haftungsbeschränkung. Hertz Autovermietung: attraktive Preise und exklusive Die Hertz Collections garantieren Ihnen genau das Model, welche Sie gewählt haben. Und profitieren Sie auch noch von 30% Rabatt mit der Hertz Tieftax-Karte. Hertz alquiler furgoneta Hertz: informacion, analisis, precio, y comparativas de estas empresas de alquiler de furgonetas. Alquiler de furgonetas Avis En Avis tenemos...»

«Artemis Fowl: The Time Paradox (Artemis Fowl #6) Eoin Colfer Artemis’s mom has gotten smaller a dangerous disease—and the one medication lies within the mind fluid of African lemurs. Unfortunately, Artemis himself was once chargeable for making the lemurs extinct 5 years ago. Now he needs to enlist the help of his fairy associates Artemis Fowl: The Time Paradox (Artemis Fowl #6) to commute again in time and store them. not just that, yet he needs to face his deadliest foe yet. his more...»

«CENTRO DE POLÍTICA DE COMPETENCIA II SEMINARIO DE EXPERTOS TEST DE DOMINANCIA VERSUS TEST DE REDUCCIÓN DE LA COMPETENCIA ASPECTOS ECONÓMICOS Juan Briones1 Marzo de 2002 Consultor de € Konomica TEST DE DOMINANCIA VERSUS TEST DE REDUCCIÓN DE LA COMPETENCIA ASPECTOS ECONÓMICOS ÍNDICE 1. CONTENIDO MATERIAL DEL CRITERIO. 2. EVOLUCIÓN HISTÓRICA DEL CRITERIO EN LA UE 2.1. Tratamiento de los oligopolios. 2.2. Tratamiento de las filiales comunes o empresas en participación 2.3. Paradigma...»

«Guía sobre sus Derechos y Responsabilidades Cuando Reclame Beneficios por Desempleo en Connecticut Usted es responsable de entender la información en este folleto. Favor de leer esta información cuidadosamente para aprender los procedimientos para presentar los reclamos, elegibilidad y requisitos para beneficios y el proceso de apelación. www.ct.gov/dol Asistencia en la búsqueda de trabajo – Página 1 Visite nuestra página de Internet A el Reclamador de Seguro Para Desempleados Gracias...»

«Lexicalisation Patterns of Rendering Path Descriptions in Polish Translation from English d O r O tA Ch ł O p e k University of Bielsko-Biała; Bielsko-Biała, Ul. Willowa 2, PL – 43–309 Bielsko-Biała, dorotach@ath.bielsko.pl SCN V/2 [2012], 37–55 Članek govori o izrazito dvokategorijalni tipologiji jezikov, ki jo je razvil Talmy. Raziskovalec izpostavlja jezike, ki pot ali cilj označijo zunaj glagolskega okvira (»satelitsko uokvirjeni jeziki«), ter jezike, ki pot ali cilj označijo...»

«Through the Marktprämienmodell towards a necessary Flexible Electricity Production from Biogas in Germany? Jakob Graf University of Aalborg M.Sc. Sustainable Energy Planning and Management I University of Aalborg Department of Development and Planning M.Sc. Sustainable energy Planning and Management 4th Semester Master Thesis Title: Through the Marktprämienmodell towards a necessary flexible electricity production from biogas in Germany? Project Period: February 1 – June 7, 2012 Supervisor:...»

«A message from the Author Dear friend, It has now been over six years since this book first appeared in print and I have definitely been pleased with some of the feedback that I have gotten from it. I have also received the following academic reviews, which I am happy to share with you for your reference. “I‟ve had a chance to read through your manuscript and I find it very interesting! I think you‟ve made an important contribution, especially to contextualizing biblical ideas about...»

«NONPROFIT ORG Edmund Rice (1638) Assoc., Inc. US POSTAGE 416 Shirley Place PAID Valdosta, GA 31605-6422 VALDOSTA GA Address Service Requested Grace V PERMIT NO. 127 In EDMUND RICE (1638) ASSOCIATION NEWSLETTER Published Winter, Spring, Summer and Fall by the Edmund Rice (1638) Association 416 Shirley Place Valdosta, GA 31605-6422 The Edmund Rice (1638) Association, Inc. 24 Buckman Dr. Chelmsford, MA 01824 was established in 1851 and incorporated in 1934 to encourage antiquarian, genealogical,...»

«Cordless, Rechargeable VACUUM CLEANER Household Type Owner’s Guide Model 74 Charge 10-12 hours before first use. Index Important Safeguards. 2 Service Information Assembly Use Dust Cup Motor Filter Battery Disposal Order Form Warranty www.eureka.com ©1999 White Consolidated Industries, Inc. Part No. 59217 (3/01) Printed in U.S. A. IMPORTANT SAFEGUARDS When using an electrical appliance, basic precautions should always be followed, including the following: READ ALL INSTRUCTIONS BEFORE USING...»

«≈√ Guidelines on Credit Risk Management C r e d i t A p p r ova l P r o c e s s and Credit Risk Management These guidelines were prepared by the Oesterreichische Nationalbank (OeNB) in cooperation with the Financial Market Authority (FMA) Published by: Oesterreichische Nationalbank (OeNB) Otto Wagner Platz 3, 1090 Vienna, Austria Austrian Financial Market Authority (FMA) Praterstrasse 23, 1020 Vienna, Austria Produced by: Oesterreichische Nationalbank Editor in chief: Gunther Thonabauer,...»





 
<<  HOME   |    CONTACTS
2016 www.theses.xlibx.info - Theses, dissertations, documentation

Materials of this site are available for review, all rights belong to their respective owners.
If you do not agree with the fact that your material is placed on this site, please, email us, we will within 1-2 business days delete him.