"Arundel partners binomial real option valuation" Essays and Research Papers

Sort By:
Satisfactory Essays
Good Essays
Better Essays
Powerful Essays
Best Essays
Page 1 of 50 - About 500 Essays
  • Better Essays

    Arundel Partners

    • 1049 Words
    • 5 Pages

    Case Write-Up: Arundel Partners 15.415 Finance Theory Section B‚ Oysters Arundel Partners: The Sequel Project With the purchase of sequel rights‚ what Arundel is achieving is to have a call option on the revenue that each movie brings. This helps to remove the uncertainty and risks associated with producing a movie‚ especially with regard to moviegoers’ taste. With the sequel right‚ Arundel will only exercise this option to produce a sequel if the first movie proved to be popular and the

    Premium The Walt Disney Company Walt Disney Option

    • 1049 Words
    • 5 Pages
    Better Essays
  • Powerful Essays

    Arundel Partners

    • 1802 Words
    • 8 Pages

    1. INTRODUCTION In 1992‚ Arundel Partners was looking into the idea of purchasing the sequel rights associated with films produced by one or more major movie studios. Movie rights were to be purchased prior to films being made. Arundel wanted to determine if this innovative business strategy is viable by estimating the value of the sequel rights. 2. OBJECTIVE Our report aims to investigate the viability of the implementation of Arundel’s strategy in purchasing sequel rights to produce

    Premium Normal distribution Film Derivative

    • 1802 Words
    • 8 Pages
    Powerful Essays
  • Good Essays

    Arundel Partners Case

    • 1437 Words
    • 17 Pages

    Arundel Partners: The Sequel Project The maximum per-film price for the sequel rights that Arundel Partners should pay is $5.12M. If Arundel Partners were to use the traditional DCF methods to find the value of the sequel rights‚ the NPV would be -$8.42M loss per-film (see Appendix 1). Calculation Details We assume that Arundel Partners will purchase a portfolio of films similar to one used in the analysis. The average hypothetical net inflow of the sequel ($21.57M) is used to figure out the value

    Premium Option Discounted cash flow

    • 1437 Words
    • 17 Pages
    Good Essays
  • Satisfactory Essays

    Arundel Partners

    • 907 Words
    • 4 Pages

    Submitted by‚ Anil Anjum Nisar Ahmed Murtaza Naqvi Omer Akif Arundel Partners: The Sequel Project If the first movie was a success they would exercise their right and make the sequel or sell it to the highest bidder. Otherwise they would just write it off their investment schedule. The chances of making a profitable business would largely depend on a good estimate of the rights present value at the contract date. To less would not tempt the studios (inquiries indicated not less than USD 2 million

    Premium Time Film Standard deviation

    • 907 Words
    • 4 Pages
    Satisfactory Essays
  • Good Essays

    Arundel Partner

    • 1362 Words
    • 6 Pages

    The questions in this sample exam are mostly quantitative‚ but you should also expect some qualitative ones‚ such as true/false questions‚ on the exam. I did not include any here‚ as each true/false will require a different reasoning than others. Question 1: Consider a project with the following risk-free cash flows: t = 0 t = 1 t = 2 -40 20 25 Suppose that one year zero-coupon bonds yield 6% and two year zero-coupon bonds yield 8%. 1a) Find the NPV of the project.

    Premium Bond Stock Stock market

    • 1362 Words
    • 6 Pages
    Good Essays
  • Good Essays

    Guidelines for the Arundel Partners Case Assignment This is a group project and only one case-report should be submitted FIN 6425 – “Arundel Case” Guidelines Nimalendran In this case‚ a movie industry analyst is asked to evaluate a proposed venture in which a group of partners would purchase the sequel rights to movies produced by the major studios. Your objective is to 1) discuss and evaluate the basic concept; 2) determine the value of the sequel rights on a per-movie basis; 3) evaluate

    Premium Net present value Option Rate of return

    • 924 Words
    • 4 Pages
    Good Essays
  • Good Essays

    Arundel Partners Case

    • 600 Words
    • 3 Pages

    Assuming that Arundel Partners is a purely financial company with no experience in the movie industry whatsoever‚ one reason for them to buy the rights to create sequels would be to exploit a possible arbitrage in between the price they would pay for an option to sequels and its real value. Therefore valuing the said option correctly is of the most importance. 1.2 We believe that portfolio negotiation rather than on a film-by-film basis will level the playing field. Since the partners do not have

    Premium Film Standard deviation

    • 600 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    Option Valuation

    • 960 Words
    • 4 Pages

    Option Valuation Chapter 21 Intrinsic and Time Value intrinsic value of in-the-money options = the payoff that could be obtained from the immediate exercise of the option for a call option: stock price – exercise price for a put option: exercise price – stock price the intrinsic value for out-the-money or at-themoney options is equal to 0 time value of an option = difference between actual call price and intrinsic value as time approaches expiration date‚ time value goes to zero 21-2

    Premium Option Call option Options

    • 960 Words
    • 4 Pages
    Satisfactory Essays
  • Powerful Essays

    Why This is an Attractive Project The Arundel Partners’ believe that they can make money on this project as it allows them to capitalize on the idiosyncratic risk of the motion picture business. Producing and distributing motion picture films is a risky business due to the uncertainty of moviegoers’ tastes and a studio never knows if they have a blockbuster on their hands until after the movie has started production or even later after it has been released. The financial resources of even the largest

    Premium Film Investment Movie theater

    • 1440 Words
    • 6 Pages
    Powerful Essays
  • Satisfactory Essays

    Arundel Partners: The Sequel project 1. Why do the principals of Arundel Partners think they can make money buying movie sequel rights? Why do the partners want to buy a portfolio of rights in advance rather than negotiating movie-by-movie to buy them? • The principals of Arundel Partners think they can make money buying movie sequel rights because they can use unpredictability of a movie’s success to their advantage. This can be done by exercising the right if the movie is a success

    Premium Film Art Movie theater

    • 905 Words
    • 4 Pages
    Satisfactory Essays
Previous
Page 1 2 3 4 5 6 7 8 9 50