Research Of Ship Investment Decision Method Based On Mixed Compound Options Theory

As we all know, the shipping market is a resource-intensive market. Compared with other industries, shipping industry has investment amount, the investment capital is recovered in long and influence factors and other characteristics. Therefore, when the shipping decision-makers decide to invest the shipping project, they should think a lot about it, if the decision-making is right, it would provide a tremendous opportunity to grow the revennue and the enterproses's development, on the contrary, it may face the risk of failure. Based on the above description, this paper researches how to invest marine projects scientificly and reasonably in my point.In this paper, we research the shipping investment in qualitative aspect and quantitative aspect. The former first described the shipping investment decision's concept, meaning and procedures, expounds the influence factors in the process of investment, traditional decision method and its limitations, later introduced the definition, types, theoretical basis and the basic methods of the main appliacation of real options analysis, and divides the shipping investment options into a time series compound real option and real options of the same phases. We defined the practical option type as the mixed compound real options. The latter introduced the triple tree's assumptions, pricing model and the decision rules of each decision point, and used the GARCH(1,1) model by the Eviews to estimate the parameter ofσ, and analysis a instance by the triple tree and the binary tree, and caculate the rusults. In end, we got the conclusion that the trinomial tree pricing model is more precise than the binary tree pricing model if we divided the decision interval into the same time steps, and the above two methods estimated the value of the decision-making flexibility, the future market uncertainty and the development opportunities, which are more accurately estiamte the value of investment projects than the traditional methods.Finally, the paper summarizes the shortcomings and the directions of future research.