Real Option Investment Under Uncertainty

This paper starts from the introduction of uncertainty in the realistic economy. It firstly affirms massive uncertainty in the economy and the decision-making, this also is a main base on which this article discusses. In reality, the uncertainty affects investment decisions from all aspects. The paper introduces the objective existence of a real option in the uncertain investment environment, summaries the kind of investment options and the type and specificity of real options from a qualitative perspective, and discusses the differences between real options and financial options. The paper stresses Real Options applied in the investment decisions is not only adding flexibility and agility, but provides a new way of thinking and applying methods. And more, the idea of options can be used in the investment projects in reality.In this paper, affirmed the existence of real options on the basis of quantitativeaspects of the introduction of the Black-Scholes Option Pricing Model, the binomial option pricing model and operations research of dynamic programming model to give real options quantitative analysis. Black-Scholes formula from the start on the pricing of their basic idea, that the binomial model is a more suitable for real options pricing method and the appropriate use of a dynamic planning ways to solve some of the investment decision-making dynamic multi-stage decision-making . In addition, the pricing model introduced in this paper also cited a number of cases that use mathematical model of the pricing calculation.In the real options analysis of the introduction of investment decision-making, the paper discussed the real options analysis of ROA (Real option analysis) and NPV analysis of some differences and contact, trying to uncertain conditions and in certain assumptions based on the premise of the use of physical Analysis of thinking and the binomial option pricing model to find the environment of uncertainty in the value of the investment projects are critical value. Briefly introduced the use of real options analysis of investment projects in the framework of the uncertainty, real options and investment decisions of the organic combination, thus making investment decisions in the flexibility of the project is no longer a vague decision-makers experience, but a scientific and rational analysis methods and modalities.Finally, this paper cited the case of four investments, the aforementioned organic combination of theory and practice, the last case combines the dynamic programming of support in the value of the real options. Writing to this paper, uncertainty,real options,and investment decisions of the main line of thinking rational investment decisions using options analysis.