Fundamentals: Financing and Risk

Massimo Massa (), Kai Taraporevala and Ludo Van der Heyden ()
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Massimo Massa: INSEAD

Chapter 6 in Value Creation for Owners and Directors, 2023, pp 129-141 from Springer

Abstract: Abstract Owners must understand how fundamentals of risk and financing affect the selection and success of strategies. In our discussion of a company’s need for financing, we follow the risk-return paradigm of modern finance. However, deviating from the classical Modigliani-Miller treatment, we show how equity financing through IPOs enables and influences strategies. Three types of risk are discussed in this book: volatility, black swan, and obsolescence. Two of these risks, volatility and black swan, are investigated in this chapter. The third risk, obsolescence, is dealt with in Chap. 7 .

Keywords: fundamentals; risks; financing; volatility; black swans (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-19726-0_6

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DOI: 10.1007/978-3-031-19726-0_6

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