Financial options methodology for analyzing investments in new technology
- Texas Utilities Services, Inc., Dallas, TX (United States)
The evaluation of investments in longer term research and development in emerging technologies, because of the nature of such subjects, must address inherent uncertainties. Most notably, future cash flow forecasts include substantial uncertainties. Conventional present value methodology, when applied to emerging technologies severely penalizes cash flow forecasts, and strategic investment opportunities are at risk of being neglected. Use of options valuation methodology adapted from the financial arena has been introduced as having applicability in such technology evaluations. Indeed, characteristics of superconducting magnetic energy storage technology suggest that it is a candidate for the use of options methodology when investment decisions are being contemplated.
- Research Organization:
- National Aeronautics and Space Administration (NASA), Washington, DC (United States); National Aeronautics and Space Administration, Houston, TX (United States). Lyndon B. Johnson Space Center
- OSTI ID:
- 121628
- Report Number(s):
- CONF-940627-Vol.2; ON: TI95017155; TRN: 99:003567
- Resource Relation:
- Conference: 4. international conference and exhibition of the World Congress on Superconductivity, Orlando, FL (United States), 27 Jun - 1 Jul 1994; Other Information: PBD: 1994; Related Information: Is Part Of Proceedings of the fourth international conference and exhibition: World Congress on superconductivity. Volume 2; Krishen, K.; Burnham, C. [eds.] [National Aeronautics and Space Administration, Houston, TX (United States). Lyndon B. Johnson Space Center]; PB: 400 p.
- Country of Publication:
- United States
- Language:
- English
Similar Records
Option pricing for project evaluation: An introduction. Final report
DSO+T: Valuation Methodology and Economic Metrics (DSO+T Study: Volume 4)