The Value Discovery And Bidirectional Incentive Mechanism Of Gambling In Private Equity Investment

Valuation Adjustment Mechanism (VAM) plays an important role in investment projects in the capital market.it is a good solution to the problem of adverse selection and moral hazard due to both investment and financing information asymmetry caused. This paper describes in detail various aspects of the core provisions contained in the VAM, including those based on the performance of gambling, listed on gambling, exit mechanism. We know that investment banking institutions in the mature European and American countries will invest in the project that they were close to the market changes, more accurate quantification and valuation. Therefore, Therefore, this paper carried out a reasonable valuation by real option valuation method in expansion options for investment projects. By Black-Scholes option valuation model, binomial option valuation model for financing parties signed an agreement on gambling were valuation. Using zero-sum game model and the risk-benefit model in a dynamic environment, analysis the risk-benefit in the gambling agreement. In order to clearly reflect the actual VAM, paper selects three new board listed on the gambling agreement to support the point of view of business cases. Study found that real options in investment decision-making rationality; VAM valuable discovery; VAM have a strong incentive for financing corporate management. VAM is a double-edged sword. Therefore, the core provisions of an agreement on gambling design is particularly important. Therefore, the design of VAM is very important. On this basis, this paper provides investors with a reasonable valuation method for investment decision-making. VAM provides a value scale, but also shows its strong incentive. This has a profound theoretical and practical significance.