Commodity Linked Bond Optimal by Mello Antonio (3 results)

PAP. Condition: New. New Book. Shipped from UK. Established seller since 2000.

PAP. Condition: New. New Book. Shipped from UK. Established seller since 2000.

Paperback. Condition: New. Print on Demand. This book investigates the use of commodity-linked bonds, a hybrid debt instrument, as a means of providing optimal financing for a company's operations. The author constructs an example to demonstrate that in the presence of moral hazardâ"a situation in which one party to a contract has an incentive to take actions that are not in the best interest of the other partyâ"a firm may prefer to issue a bond linked to the price of a commodity, as opposed to a fixed-rate bond. The use of a commodity-linked bond can align the incentives of both parties, leading to more efficient investment and operating decisions and higher overall value for the firm. The author also shows that traditional contingent claim valuation techniques, which assume no impact on management decisions from the parameters of the liabilities sold against the firm, can lead to incorrect valuations of both the real assets and the financial liabilities written against those assets. The book provides a valuable framework for understanding the complex interactions between financial contracts and real asset management in the presence of moral hazard and highlights the potential benefits of using commodity-linked bonds as a financing instrument. This book is a reproduction of an important historical work, digitally reconstructed using state-of-the-art technology to preserve the original format. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in the book. print-on-demand item.…