Feature Article “Decision Clarity”

Feature Article “Decision Governance“

Book Chapter: Scenario Planning as an Enrichment of ERM – Henk Krijnen

Book Chapter: Leveraging ERM for Growth – Diana Del Bel Belluz

Probabilistic valuation: a brief overview

In this article the concept of probabilistic investment (risk) analysis is briefly discussed.

Risk and the discount rate

In the world of Finance the discount rate that should be applied to discount a cash flow is often viewed as a good measure of risk associated with the opportunity being analyzed. In this article we argue that this is a flawed perspective.

A new method for discretization of continuous distributions

In probabilistic investment analysis use is made of continuous probability distributions to describe uncertain quantities. It is sometimes needed to discretize such distributions, for example for use in decision trees. A well known method is the so called Swanson rule. This article provides a generic mathematical approach for discretization.

The lognormal distribution

In probabilistic investment analysis, often use is made of the lognormal distribution. This article provides the math, with a number of useful derivations and formulas.

Truncation of the lognormal distribution

Now it is getting very nerdy. This is a mathematical discussion of the truncation of a lognormal distribution.

The essence of the DeltaLogN method

The DeltaLogN method is a way to mathematically aggregate quantified uncertainties associated with an investment decision and for example calculate the chance of a negative NPV resulting from the investment project. As such it is an alternative for Monte Carlo simulation for example. Again, quite nerdy. For full understanding, this will require going through the online course ‘Probabilistic Investment Analysis’. Or just contact us!