Concept
Real options valuation
Related concepts (24)
Aswath Damodaran
Aswath Damodaran (born 24 September 1957), is a Professor of Finance at the Stern School of Business at New York University (Kerschner Family Chair in Finance Education), where he teaches corporate finance and equity valuation. Known as the "Dean of Valuation" due to his expertise in that subject, Damodaran is best known as the author of several widely used academic and practitioner texts on Valuation, Corporate Finance and Investment Management as well as provider of comprehensive data for valuation purposes.
Business school
A business school is a university-level institution or professional school that confers degrees in business administration or management. A business school may also be referred to as school of management, management school, school of business administration, or colloquially b-school or biz school.
Intrinsic value (finance)
In finance, the intrinsic value of an asset or security is its value as calculated with regard to an inherent, objective measure. A distinction, is re the asset's price, which is determined relative to other similar assets. Note, then, that the intrinsic approach to valuation may be somewhat simplified, in that it ignores elements other than the measure in question. For an option, the intrinsic value is the absolute value of the difference between the current price (S) of the underlying and the strike price (K) of the option, to the extent that this is in favor of the option holder.
Strike price
In finance, the strike price (or exercise price) of an option is a fixed price at which the owner of the option can buy (in the case of a call), or sell (in the case of a put), the underlying security or commodity. The strike price may be set by reference to the spot price, which is the market price of the underlying security or commodity on the day an option is taken out. Alternatively, the strike price may be fixed at a discount or premium. The strike price is a key variable in a derivatives contract between two parties.