Real Options in a nutshell - jaoo.dk

Real Optionsin a nutshellin a nutshell

Olav MaassenQNH

Chris MattsAccellinnova

© alisdair

Real Options:What are theyWhat are they

And how do they improve your life?

The Game

© jimmyrog

© fatal Cleopatra

Risk

Time

Agile

© thelastminute

Source: Kevin Tate, Alias Software

Risk

Time

Waterfall

© - Woo -

An Arbitrage(Free Money)

© wilhei55

© moonpix7

Options everywhere

© Justin Russell

© tvol

• Price drops to $90 • Price goes to $110

100.000 (+/- 5%) barrels of oil for $100 / barrel

Total value: $10.000.000

• Price drops to $90

• 95.000 barrels

• Cost saving: $10 * 5.000

• Price goes to $110

• 105.000 barrels

• Extra profit: $10 * 5000

• Price drops to $90 • Price goes to $110

100.000 (+/- 5%) barrels of oil for $100 / barrel

Total value: $10.000.000

• Price drops to $90

• 95.000 barrels

• Cost saving: $10 * 5.000

• Price goes to $110

• 105.000 barrels

• Extra profit: $10 * 5000

95.000 barrels plus the option to buy 10.000 more

Financial Options

Embedded Options

Maths

FinancialMaths

Real Options

Information

© Striker W@SP

Black Scholes….. A House of Cards

© janetmck

Oops!

© shaymus022

Never commit early unless you

know why

Options have value© luismi1985

Options expire

© givepeasachance© Tub Gurnard

1. Right2. Wrong3. Uncertainty

© Bethany L King

© Violator3

A or B?

Maths

WWW.

Grid

© The Nug

© Uninen

© TAudiophile

© lucadex

© codyR

© Hamedog

© elliottcable

© whitneybee

STOPGuessing!

© topher76

Create Options

© haydnseek

Prepare to run fast.

© James Temple

……and have fun.© lordkirbs

Q&A

Further Reading:

Article: “Real Options” underlie agile practiceshttp://www.infoq.com/articles/real-options-enhance-agility

Contact Information:

Olav Maassen ([email protected]) Chris Matts ([email protected])

All photo’s are licensed under the Creative Commons license by their respective owners.Pictures are taken from flickr.com