Optimal Corporate Strategy under Uncertainty

• Main Authors: CHEN, Andrew H., FABOZZI, Frank J., Dashan HUANG
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2013
• Subjects: optimal corporate strategy; strategic business units; intertemporal capital asset pricing model (ICAPM); real options theory; SBU's market-volatility risk; SBU's state-variable risk; risk-adjusted net present value (RANPV) rule; Corporate Finance; Finance and Financial Management
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/4784
• Institution: Singapore Management University

Within a dynamic setting, optimal corporate strategy management for a multi-division corporation involves restructuring a portfolio of Strategic Business Units (SBUs) periodically so as to maximize the firm's market value. Real option theory has been applied to model and explain managerial flex...