IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v18y1972i12pb654-b662.html
   My bibliography  Save this article

The Resolution of Investment Uncertainty Through Time

Author

Listed:
  • Harold Bierman, Jr.

    (Cornell University)

  • Warren H. Hausman

    (Massachusetts Institute of Technology)

Abstract

Investments in operating assets with identical expected discounted return and identical risk characteristics (i.e., variances and higher moments) when measured at the outset may have significantly different patterns of uncertainty resolution over their lives. The concept of uncertainty resolution, although ambiguous, is a potentially important characteristic of an investment alternative. This paper explores the usefulness and limitations of the concept of uncertainty resolution in the evaluation of both single risky investments and in portfolios of risky investments. In cases where future investment opportunities are completely known the concept does not seem useful; however, in a more realistic setting where future investment alternatives are ill defined at present, the concept may prove useful. Further research is needed to explore fully the questions raised here.

Suggested Citation

  • Harold Bierman, Jr. & Warren H. Hausman, 1972. "The Resolution of Investment Uncertainty Through Time," Management Science, INFORMS, vol. 18(12), pages 654-662, August.
    • Handle: RePEc:inm:ormnsc:v:18:y:1972:i:12:p:b654-b662
    DOI: 10.1287/mnsc.18.12.B654
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mnsc.18.12.B654
    Download Restriction: no
    File URL: https://libkey.io/10.1287/mnsc.18.12.B654?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luke T. Miller, 2010. "PMA license valuation: A Bayesian learning real options approach," Review of Financial Economics, John Wiley & Sons, vol. 19(1), pages 28-37, January.
    2. Miller, Luke T., 2010. "PMA license valuation: A Bayesian learning real options approach," Review of Financial Economics, Elsevier, vol. 19(1), pages 28-37, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:18:y:1972:i:12:p:b654-b662. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.