DocumentCode
2211013
Title
Indexed Option Based Valuation of Private Benefits of Control
Author
Wang, Zhebing ; Han, Liyan
Author_Institution
Sch. of Econ. & Manage., Beihang Univ., Beijing, China
fYear
2009
fDate
26-28 Dec. 2009
Firstpage
4907
Lastpage
4910
Abstract
The benefits of control, also called voting right are treated as protective put options against the hired CEO´s capability for the first time. The indexed option pricing model is used to estimate this value. However, the results show that the value of voting right is decreasing with the incumbent CEO´s capability. Although the growth rate of the average capability of the professional manager market is exogenous, the value of the voting right is raising as the growth rate increases. This result can be used to as a reference of the determination of the premium price in corporate control market.
Keywords
corporate modelling; pricing; stock markets; CEO; corporate control market; indexed option based valuation; indexed option pricing model; private control benefits; professional manager market; Conference management; Cost accounting; Decision making; Engineering management; Information science; Pricing; Protection; Resource management; Uncertainty; Voting;
fLanguage
English
Publisher
ieee
Conference_Titel
Information Science and Engineering (ICISE), 2009 1st International Conference on
Conference_Location
Nanjing
Print_ISBN
978-1-4244-4909-5
Type
conf
DOI
10.1109/ICISE.2009.675
Filename
5454658
Link To Document