Freight Futures and Chartering: A Contingent Claims Analysis Approach applied to Optimal Operational and Investment Decisions in Bulk Shipping

1993 ◽  
pp. 145-167 ◽  
Author(s):  
Franklin O. de Goncalves
Keyword(s):  
Investment Decisions ◽  
Contingent Claims ◽  
Analysis Approach ◽  
Claims Analysis ◽  
Contingent Claims Analysis ◽  
Bulk Shipping

Partially Irreversible Investment Decisions and Taxation under Uncertainty: A Real Option Approach

2002 ◽  
Vol 3 (2) ◽  
pp. 185-221 ◽  
Author(s):  
Caren Sureth
Keyword(s):  
Real Option ◽  
Investment Decisions ◽  
Contingent Claims ◽  
Investment Model ◽  
Option Valuation ◽  
Claims Analysis ◽  
The Real ◽  
Contingent Claims Analysis ◽  
Real Option Approach ◽  
Tax Systems

AbstractThe paper applies contingent claims analysis in a real option investment model in order to investigate taxation's influence on investor's decisions under uncertainty. The results show the distortion from realistic-type tax systems, allow to identify a tax-induced paradox in option valuation for specific settings and acknowledge the property of investment neutrality of well-known `ideal' tax systems in the context of different degrees of irreversibility. Furthermore, it is clarified that the idea of risk-neutral valuation cannot be adopted by the real option approach in general.

scholarly journals The Impact of Banking Competition on Firm Credit Risk and Leverage

SAGE Open ◽  
2021 ◽  
Vol 11 (4) ◽  
pp. 215824402110615
Author(s):  
Chengxiao Feng ◽  
Zhubo Li ◽  
Zhen Peng
Keyword(s):  
Default Risk ◽  
Credit Constraints ◽  
Contingent Claims ◽  
Claims Analysis ◽  
Banking Competition ◽  
Leverage Ratio ◽  
Contingent Claims Analysis ◽  
Credit Risks ◽  
Default Risks ◽  
The Impact

A firm’s default risk is closely related to its macrofinancial stability. As financial reform deepens, banking competition may ease firms’ credit constraints, encouraging them to increase their leverage and default risks. This study uses contingent claims analysis to examine firms’ asset–liability ratio and default distance. We find that companies have low leverage and low overall default risks. Moreover, a pro-cyclical effect exists between leverage and economic growth. As banking competition becomes more intense, the default risk decreases, but firms’ leverage ratio rises significantly. The impact is more prominent for highly leveraged firms. Our findings also indicate that utilizing the contingent claims analysis method to measure firms’ leverage and default risks provides more accurate results. Moreover, we provide empirical evidence of the impact of banking competition on firms’ leverage and credit risks. The results suggest that enhancing financial competition has a positive effect on easing credit constraints and reducing default risks.

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