An Integrated Model of Multinational Flexibility and Financial Hedging
Antonio S Mello, John E Parsons, Alexander J Triantis
In this paper we construct a model of a multinational firm with flexibility in sourcing its production and with the ability to use financial markets to hedge exchange rate risk. The firm's need for...
Valuing Flexibility as a Complex Option.
Triantis, Alexander J, Hodder, James E
This paper develops an approach for valuing flexible production systems using contingent claims pricing. Demand curves for the authors' model's underlying assets (output products) may be downward...
Interactions of Corporate Financing and Investment Decisions: A Dynamic Framework.
Mauer, David C, Triantis, Alexander J
This article analyzes the interaction between a firm's dynamic investment, operating, and financing decisions in a model with operating adjustment and recapitalization costs. Using numerical...
Cross-Holdings: Estimation Issues, Biases, and Distortions.
Fedenia, Mark, Hodder, James E, Triantis, Alexander J
Cross-holding occurs when listed corporations own securities issued by other corporations. We analyze the effect of cross-holdings on market capitalization and return measures as well as implications...
Timing Problems in Contract Breach Decisions.
Triantis, Alexander J, Triantis, George G
In contracts susceptible to efficient breach, each party has an American option to breach and pay damages rather than perform. She will repudiate early if the expected decrease in damages liability...
Mixed Uses and the Redevelopment Option
Paul D. Childs, Timothy J. Riddiough, Alexander J. Triantis
This paper considers how the potential for mixing uses and redevelopment impact property value. Operating flexibility of this type is found to significantly increase property value when the...
REAL OPTIONS AND CORPORATE RISK MANAGEMENT
By formulating an integrated strategy that combines the creation and exercise of real options together with other risk management techniques, management can reduce risk and thereby increase firm...
Capital Budgeting for Interrelated Projects: A Real Options Approach
Childs, Paul D., Ott, Steven H., Triantis, Alexander J.
This paper explores the effect of project interrelationships on investment decisions and project values in a real options framework. We examine in detail the mutually exclusive case where a firm may...