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Difficulties in business valuation issue in the context of investment strategies

Author

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  • Claudiu Oprescu

    (University of Craiova, Romania)

Abstract

Value is the defining dimension of measurement in a market economy. People invest in the expectation that when they sell, the value of each investment will have grown by a sufficient amount above its cost to compensate them for the risk they took. This is true for all types of investments, be they bonds, derivatives, bank accounts, or company shares. Indeed, in a market economy, a company’s ability to create value for its shareholders and the amount of value it creates are the chief measures by which it is judged. Value is a particularly helpful measure of performance because it takes into account the long-term interests of all the stakeholders in a company, not just the shareholders.

Suggested Citation

  • Claudiu Oprescu, 2015. "Difficulties in business valuation issue in the context of investment strategies," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 15(1), pages 237-244.
    • Handle: RePEc:pet:annals:v:15:y:2015:i:1:p:237-244
    as

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    References listed on IDEAS

    as
    1. Jensen, Michael C, 1988. "Takeovers: Their Causes and Consequences," Journal of Economic Perspectives, American Economic Association, vol. 2(1), pages 21-48, Winter.
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    More about this item

    Keywords

    value creation; mergers and acquisitions; synergy; value;
    All these keywords.

    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

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