Real options capital budgeting

• Opportunities that are embedded in capital projects that enable managers to alter their cash flows and risk in a way that affects project acceptability (NPV). Also called strategic options.


Follow this link for all the terms related to capitaloption.

 Embedded terms in definition
Cash flow
 Related Terms
After tax real rate of return
Average cost of capital
Barrier options
Basket options
Capital account
Capital adequacy
Capital allocation decision
Capital appreciation
Capital asset
Capital asset pricing model
Capital budget
Capital budgeting
Capital cost allowance
Capital expenditure
Capital flight
Capital gain
Capital gains yield
Capital impairment rule
Capital lease
Capital loss
Capital market
Capital market efficiency
Capital market imperfections view
Capital market line
Capital rationing
Capital stock
Capital structure
Capital surplus
Change in net working capital
Closing or to close for real estate
Complete capital market
Compliance registered options principal
Cost of capital
Cost of limited partner capital
Dealer options
Debt capital
Debt to capital ratio
Dedicated capital
Delivery options
Efficient capital market
Equity capital
Equity options
Exchange rate risk capital budgeting
Financial or capital lease
Gigo garbage in, garbage out in capital budgeting
Hard capital rationing
Human capital
Invested capital
Issued share capital
Legal capital
Margin requirement options
Marginal cost of capital
Marginal cost of capital schedule
Net working capital
Net working capital recapture
Nondiversifiability of human capital
Opportunity cost of capital
Optimal capital structure
Options clearing corporation
Options contract
Options contract multiple
Options on physicals
Other capital
Outstanding share capital
Pecking order view of capital structure
Perfect capital market
Perfect market view of capital structure
Personal tax view of capital structure
Pie model of capital structure
Planned capital expenditure program
Pro forma capital structure analysis
Purchase options
Real assets
Real capital
Real cash flow
Real estate
Real estate investment trust
Real estate limited partnership
Real estate mortgage investment conduit
Real exchange rates
Real interest rate
Real market
Real rate of interest
Real rate of return
Real return bonds
Real time
Registered options principal
Regulatory capital
Remic real estate mortgage investment conduit
Renewal options
Reset options or reprice options
Risk capital budgeting
Senior registered options principal
Series for options
Series options
Settlement for real estate
Soft capital rationing
Sophisticated approaches to capital budgeting
Static theory of capital structure
Target capital structure
Taxable capital gain
Total capital
Uniform net capital rule
Venture capital
Weighted average cost of capital
Working capital
Working capital management
Working capital ratio

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