Perhaps the most difficult objection raised by skeptics of the real options approach concerns the apparent lack of market transactions that would verify that real options have actual value. Although there are no organized exchanges with publicly disclosed prices, there are nevertheless several...

Although employee stock ownership may result in increased cash flows due to enhanced organizational productivity or improved governance, this benefit is counterbalanced by the increased risk premium due to a higher correlation between the returns to the firm and the returns to human capital in...

The premise of this discussion is that private equity players intend to create real options that maximize the value derived from potential movement in the worth of the underlying business platform. This intended maximization occurs when the current value of the exercise instrument equals the...