The application of real options as a tool for decision-making in the electricity market

Monica Andrea Arango Arango, Sergio Botero Botero

Resultado de la investigación: Contribución a una conferenciaPaper

3 Citas (Scopus)

Resumen

© 2017 AISTI. Traditional valuation methods such as Net present value (NPV) underestimate the value of projects when they face flexibility, that is to say, it does not know the actions of the managers in the face of changes in market conditions. The application of real options (OR) complements the results obtained by traditional methods, avoiding the possible underestimation of the value of investment projects. The Monte Carlo simulation used in the estimation of the OR opens the possibility of deriving the value of the option using empirical distributions on the returns of the underlying generating a series of trajectories, broadening the spectrum for the electricity market investor.
Idioma originalInglés estadounidense
DOI
EstadoPublicada - 11 jul 2017
EventoIberian Conference on Information Systems and Technologies, CISTI -
Duración: 11 jul 2017 → …

Conferencia

ConferenciaIberian Conference on Information Systems and Technologies, CISTI
Período11/07/17 → …

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    Arango, M. A. A., & Botero, S. B. (2017). The application of real options as a tool for decision-making in the electricity market. Papel presentado en Iberian Conference on Information Systems and Technologies, CISTI, . https://doi.org/10.23919/CISTI.2017.7975807