The Operational Risks Of Project Investments And The Corresponding Strategies

The decision-making target of enterprise risk investment is to make the right investment under uncertainty so as to achieve its expected value. Generally, the standard real options analysis of evaluating risk projects investment do not consider the uncertain risks during the implementation of the projects. Based on the thinking of operational risk management in bank, and the standard model of real options analysis, this paper consider the following three operational risks during the implementation, that is, financial risks, executive risks within competitive industry and debt financing risks. Establish the corresponding mathematical model, using real options evaluation to analyze the impact of the three risks on the company investment value respectively, and then the quantitative loss evaluation is given.The study consists of three parts: in the first part it discusses that the financing operational risks during the project's implementation after the corporate decision-making. After the deciders making the investment strategies, the company's related departments need to start production according to the strategic target, but the company may not have the necessary funds, so in the first part, the risks of the project caused by deterministic and stochastic preparing time is considered. In the second part, project's executive risks in competitive industry are studied. The key assumption is that the investors do not have a monopoly opportunity of the investment, during waiting to enter the market, competitors may enter and share the market, thus each company's value is reduced, but their investment chance will not be lost. In this part, uncertain impact on the whole market caused by the company's entry under the impact of industry and special company is discussed. Finally, company's debt financing risks is involved. The financing is enterprise's essential financial activities. Financing risks during invest new projects and expansion of investment is considered. Each chapter will give the appropriate measures response to the risks.