Rating: 
Summary: A born classic book!
Review: A lifetime book, a must for people interested in the modern "real options approach". Thorough and very didatic book, the maths level is far easier than Duffie's books, for instance. Requires differential calculus but at undergraduated engineering level. Previous knowledge of stochastic calculus and optimization under uncertainty are not required because there are two excellent chapters where the authors explain these tools in a concise format. For serious students, researchers and practitioners in capital budgeting, financial economics and investment theory. Comprehensive industrial applications models of practical importance, with several numerical results throughout charts and tables, makes this book valuable for capital budgeting consultants. In textbook format, for people interested in a deep understanding of the models, not only in rules of the thumb or ease advices. The best choice for graduated level courses, but some chapters also can be used for MBA courses, at least as complementary text. A born classic book!
Rating:
Summary: A born classic book!
Review: A lifetime book, a must for people interested in the modern "real options approach". Thorough and very didatic book, the maths level is far easier than Duffie's books, for instance. Requires differential calculus but at undergraduated engineering level. Previous knowledge of stochastic calculus and optimization under uncertainty are not required because there are two excellent chapters where the authors explain these tools in a concise format. For serious students, researchers and practitioners in capital budgeting, financial economics and investment theory. Comprehensive industrial applications models of practical importance, with several numerical results throughout charts and tables, makes this book valuable for capital budgeting consultants. In textbook format, for people interested in a deep understanding of the models, not only in rules of the thumb or ease advices. The best choice for graduated level courses, but some chapters also can be used for MBA courses, at least as complementary text. A born classic book!
Rating:
Summary: Thorough and didactic, the best book on this field
Review: Comprehensive book on "real" investment, thorough but didactic, explains and extends the modern "real options" theory. I read twice the book and it is really a "must" for serious students/researchers/profissionals working with economic evaluation of projects.
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Summary: Not a new theory,but a new way of solving Keynes's theory
Review: Dixit and Pindyck(DP)have not come up with a new theory of investment. The three aspects that they deal with in their theory are the irreversibility of costly fixed plant and equipment,the uncertainty of the information base upon which the probabilities will be estimated,and the timing of the investment project over a series of future time periods.DP correctly point out that the NPV rule does not deal with the uncertainty of the information base upon which the probabilities will be calculated while also ignoring the question of the timing of a project,given that additional new relevant information on the potential expected profitability of a project may be forthcoming in future time periods.Thus, there is a value that can be assigned to waiting for this additional relevant evidence to occur in the future.The Net Present Value( NPV) rule or the Capital Asset Pricing Model (CAPM)only deals with risk,not uncertainty.Both of these rules assume the existence of a unique,well defined probability distribution that satisfies the law of large numbers.A decision maker need only concern himself with the variability of the outcomes over time. This is measured by the standard deviation.DP demonstrate that the standard approach to investment theory discounts only for time and risk while ignoring uncertainty or conflating uncertainty with risk.DP advocate an additional discount for uncertainty.DP obtain this result using the calculus of variations, optimal control theory,stochastic control theory and dynamic programming.These techniques,while interesting ,are not necessary in order to obtain the given result.A much less advanced mathematical approach was used by John Maynard Keynes to obtain approximately the same result.A criticism of this book would be the failure on the part of DP to mention the similarities between their theory and that of Keynes.Keynes's theory is covered in chapters 11,12 and 17 of Keynes's 1936 book ,titled the General Theory(GT).In chapter 17 ,Keynes makes a very important addition to the theory of the previously mentioned chapters on pages 239-241 where Keynes points out that the decision maker must also discount for uncertainty as well as for risk and time preference.Keynes's footnote on page 240 of the GT directs the reader to his technical model contained in chapter 26 of A Treatise on Probability, called a conventional coefficient of weight and risk c.In order to obtain approximately the same result as obtained by DP,one needed only multiply Keynes's NPV model of chapter 11 of the GT by the c coefficient.
Rating: 
Summary: Good book for a serious people!
Review: I think this book is quite a good overview on the modern financial subject. I myself am not a finance people but can grasp some ideas based on thier mathematic equivalent to my field study. [Brownian Motion, Stochastic Process, Random Walk etc.] It's amazing for me to link my background in Polymer Science to this new area quite well. [I observed that there is a new area called 'Econophysics'.. perhaps I am the people in this caterogy]OK... this book is not for a people who need a 'recipe' to make money. It's a good book for people who love to learn a new thing. I think a researcher from other area like Physics, Math/Stat or other academic discipline will find something useful for your starting point of a new area of finance. King+
Rating:
Summary: Not For The Faint-Hearted
Review: Investment Under Undertainty by Avinash Dixit and Robert Pindyck has been an important book in the 1990's because it introduced a relatively new subject to a new and eager audience when there was little else available outside of original research papers. Many of us are grateful to the authors for this introduction. However, newcomers should be aware that they omit large and crucial details of implementation [example: chapter 4, section 1H, pages 110-112 including the graphs on page 111: a newcomer will be lost; if you wait until the appendix to chapter 10, on numerical solution, then you may or may not note the printing errors]. The book is not for the faint-hearted beginner; even the simplest material, such as valuation of a perpetuity (see Corporate Finance by Brealey & Myers - very easy) occurs in a form which the beginner or skim-reading manager might not readily recognise (chapter 5, secion 1A, pages 138-139); but then this book is not for them. See also Real Options by Lenos Trigeorgis, who writes as if he keenly wants you to have fast access to his subject. For someone writing purely on the mathematical finance aspects, read anything by Paul Wilmott, who is clearly both clever and an exceptional educator
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Summary: State of the art -- but math is a required subject
Review: Let me say that this is not a book for those looking for investment advice or get-rich-quick schemes. It is also not a book for those who think that an MBA and an HP12C are all you need to understand the basic theory behind investments, options, etc. It is a mathematical subject...and to those with a good mathematical background, the book is remarkably well-organized and easy to understand. I found this book to be very helpful in my research.
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Summary: que clase de riesgos cubre el libro
Review: necesito saber si involucra costos de capital a riesg
Rating:
Summary: real options
Review: ok, i found this book is very important and give a new vision to understant the world of investement under uncertainty , further it demonstrate a new application nommed real options, by this new model we can making same decision with integrating the notion of flexibility in procesus of investement
Rating: 
Summary: You must have excellent Calculus skills or Don't Bother
Review: Real options is very hot right now in management circles, and so is this seminal book on real investments. However, as is typical, this book will not be easily understood by practitioners and is more for the academic. There has yet to be a practical volume of literature that can explain real options in plain english.
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