Application of Game Theory in Evaluation of Stock Investment

Subject Areas : Financial Knowledge of Securities Analysis

غلامرضا اسلامی بیدگلی ¹ (ندارد)
رضا احتشام راثی ² (مسئول مکاتبات)

Received: 2011-02-24 Accepted : 2011-06-22 Published : 2011-09-23

Keywords: Decision making, Investment Evaluation, Game theory, normal game form, collaboration form, Dynamic form, Nash&#x0D, &#x0D, Equilibrium,

Abstract :

Nowadays the enterprises are in an intensive competition and can notmerely rely on traditional methods of decision making over certainty, riskand uncertainty situation in facing domestic or international rivals.Hence recognizing the new techniques of decision making against thecompetitors in the contradictory situations seems to be a vital necessityfor each enterprise. These techniques assist the investors to make aneconomical evaluation of the investment alternatives and help them tomanage and mitigate the risk.Investment in the developing countries is competitive and isendangered by a plenty of unknown and unexpected variables which leadthe investors towards investigating and applying the new methods like"Games Theory".This article describes how to use the Games Theory's Methods tomake the proper and timely decisions against the rivals and how toevaluate the investment alternatives economically. It also tries to showhow the Games Theory maintains the interests of different investors inthe alternatives and helps them to reach to an equilibrium point ofconsent. Study result showed that Game Theory have applicable inInvestment evaluation