Risk Assessment Of Investment Projects And Decision

The success of a venture investment project, to a large extent, lies in the accountability of the assessment on the potential project. Therefore, assessment is crucial to venture investors. The venture investors have to select the very best potential project in piles of investment projects. Good projects can bring investors excess benefits while inappropriate choice leads to huge losses. Therefore, selection and assessment of potential projects are the first but the key step of a good investment.Based on the researches done by others, this thesis starts form the basic characteristics of venture investment, analyzes each characteristic, particularly the quality of the entrepreneurs, the products and technology, the external environment and the management level of the potential company, and then apply them to the operational system of a venture investment to establish an assessment index model to make the assessment and decision-making as scientific and easy to operate as possible. The thesis quantifies the above qualitative indices and gives quantitative assessment and the weight of each factor and it also illustrates the impact of profits and risks and proposes a new decision-making solution for new venture investment, i.e. venture marginal reward ratio, which provides decision-makers a reliable and scientifically operable reference method for project assessment. Later this thesis demonstrates the application of the assessment method with two case studies.