Product Diversification, Risk Reduction, and Real Options Value

• Main Authors: Wei-Chiang Chao, 趙維強
• Other Authors: Lieh-Ming Luo
• Format: Others
• Language: zh-TW
• Published: 2010
• Online Access: http://ndltd.ncl.edu.tw/handle/81783993416929645939

碩士 === 輔仁大學 === 金融研究所 === 98 === The paper examines the relationship between the product diversification and risk reduction, and the relationship between the product diversification and real option value. In past researches, firm can utilize product diversification to reduce the risk of the firm. However, we use the real option reasoning to describe the purpose of product diversification, and explain whether product diversification exist the opportunities to find the future markets or not. From the view points of real options value, we take the product diversification as a group of options, and use these options to explore the markets. These options can help the firm to decide whether to keep investing or not. Through the empirical studies with Regression model and Panel data model, the results indicate that the product diversification can both reduce the risk and explore the future markets in different industries. Further, it is also shown that such the product diversification effect in the electronic industry is more remarkable than in the non-electronic industry, and we conclude that the electronic industry with higher technical risks is more tendentious to utilize product diversification than the non-electronic industry.