Pricing methodology and possibilities of application the real options in coke industry

Investment activity of the companies is especially important in case of high uncertainty regarding future development of the market and in case of spreading the rules of economic doctrine of sustainable development. The problem concerns mainly companies with a long-time planning horizon, high level of investment expenditures; especially in case of irreversible investment expenditures. Such a situation is characteristic for cokemaking industry. In this kind of conditions the real options are an especially useful tool for evaluating the investment projects, because the real options give the investor a possibility to react actively according to changing conditions of the market, also in the course of implementation of the project. This article presents the genesis of real options, their types and areas of application. There is a description of the process of financial evaluation of the investment projects and its stages. This paper also presents two basic options pricing models: The Black-Scholes Model and Binominal Lattice Model. In the conclusion part some of the areas of real options application in cokemaking industry are exemplified. Finally, the need to conduct a study of real options application in cokemaking industry in order to determine its optimal development path of technological structure has been emphasized as well.