Risk Component Based Infrastructure Debt Valuation Analysis and Long-Term InvestmentReport as inadecuate




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Long term financing to infrastructure and mobilization of private long term capital has been recognized as a key agenda in advancing the global economic development. There are several barriers in infrastructure financing and big gaps between expectation and reality. A highly pronounced barrier is the lacking of capacity of investors to price risks in a structured manner. This paper has discussed component-based infrastructure valuation analysis and modeling blocks. The component-based valuation mechanism is very useful for issuers and investors to categorize, analyze and price specific risks transparently and can provide a basis for structuring the risks on an ex-ante basis so as to make project investments suitable for investors of different risk preference.

KEYWORDS

Infrastructure Debt Valuation, Credit Asset Pricing, Default Probability, Component Approach

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Wang, C. and Kumar Sundararajan, S. 2016 Risk Component Based Infrastructure Debt Valuation Analysis and Long-Term Investment. Journal of Financial Risk Management, 5, 122-148. doi: 10.4236-jfrm.2016.53014.





Author: Chunlan Wang1, Satheesh Kumar Sundararajan2

Source: http://www.scirp.org/



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