Real Options Analysis: Tools and Techniques for Valuing Strategic Investments and Decisions (Book and CD ROM)

Rating:
Summary: Enjoyable Journey to Real Options
Review: This book gives a nice build up from discounted cash flows to Monte Carlo techniques. Jonathan Mun follows the cash and shows how to find value. His description of real options is clear and practical. I also recommend Mun's "Applied Risk Analysis."

Rating:
Summary: Real Options in Action
Review: This is an excellent text on Real Options Analysis. There is a definitive very well maintained balance between theory and practice. Dr. Mun will take you through a random walk, which is so natural and so powerfully pragmatic you will appreciate by the time you'll reach the final pages of the book. The powerful intuition Dr. Mun develops behind stochastic calculus and Ito's lemma makes it accessible and useful to the businessman who has to learn how to mitigate downside risks while optimizing growth opportunities in an uncertain economy. The book in itself is a real option - The mathematics is nicely explained only when needed for clarity of the subject. The abundant amount of reference is there for you to find out if interested. It is up to you to decide when you wish to exercise your options. If you can identify your real options, Dr. Mun will show you how to value those complex opportunities.

Rating:
Summary: On average: a good book
Review: This was my first book on Real Options. After this, I complemented my knowledge with more accurate researches on the theoritic foundations on the subject (eg. Trigeorgis and Copeland).
What I liked of this text is that it was a soft landing into the Real Option world, with a simple and easily understandable description. Its major pro is to present transparently the basics of a concept that is often approached at a too high and formal level.
What I did not like is the fact that few chapters at the end were not really useful but full of stuff and formulas with no explanations that cannot practically be used. I had the sensation they were out of place, since I could grasp their meaning only after passing to more comprehensive books.
One more criticism is that you don't understand the effect of the difference between private and public risk in real options evaluation as you do with other texts. However, I still consider this the book where I formed my basics before being able to master some other more detailed book (but also more difficult to master). The Crystall-Ball package was also a nice surprise. At the end, if you consider the price and the content it was surely good value for money even though it's not a masterpiece.