About This Chapter
Real Options Valuation - Chapter Summary
If you need to learn or review real options valuation, this chapter will show you everything you need to know. The chapter contains short and engaging lessons that explain the basics of options, stock evaluation, securities and more. Self-assessment quizzes are available to take following each lesson, as well as printable lesson transcripts. You can reach out to our expert instructors if you have any questions and study these lessons at any time, day or night. Upon completion of the chapter, you should be able to:
- Explain the fundamentals of option valuation
- Outline the basics of options, including puts and calls, stocks and payoffs
- Recognize different types of stock
- Assess common stock valuation and types of growth
- Identify stock price factors
- Summarize securities markets and the role of investment bankers
- Know how securities are traded on the stock exchange
- Understand how stocks are sold to raise capital
1. Fundamentals of Option Valuation
Option contracts are derivative financial instruments that obtain their value from an underlying asset - usually a stock. In this lesson, we'll discuss the components that are involved in determining the exact price of an options contract.
2. Options Basics: Stocks, Payoffs & Puts & Calls
Many people believe the financial markets are limited to buying and selling shares of stock. But, in addition to stock, there are other financial instruments. In this lesson, we'll learn about option contracts - one such variation of stock shares.
3. What is a Stock? - Definition, Types & Examples
This lesson will explore the concept of ownership in a company through stock. Also in this lesson, different types of stocks will be explained and examples will be given.
4. Common Stock Valuation & Types of Growth
Common stock valuation determines the price that a stock will sell for. Valuations are highly dependent on the expected growth of the stock. Let's look at how stock valuation works and the different ways of calculating growth.
5. Stock Price Factors: Types & Definitions
After reading this lesson, you will see how various aspects of a business can affect its stock price. Also learn how the market itself can affect stock prices to the point where it can make it crash.
6. Securities Markets and Investment Bankers
Securities markets and investment banks provide opportunities for companies to obtain capital and people to make investments to increase their wealth. In this lesson, you'll learn about securities markets and the players involved.
7. Trading Securities on the Stock Exchange
Stocks are traded all over the world seven days a week, 24 hours a day on stock exchanges located in the world's financial capitals, such as New York, London, Tokyo and Hong Kong. In this lesson, you'll learn how stocks are traded.
8. Selling Stock to Raise Capital
One method a business can use to raise funds is selling stock to potential investors. In this lesson, you'll learn about raising capital through the sale of stock, including its advantages and disadvantages.
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