Investment Criteria and Decision-Making

Making sound, well-informed financial decisions is essential to ensuring the viability of a business or project. To achieve this, it is vital to understand and master the financial management tools that enable a detailed, hard-hitting analysis of a project with a view to optimising the company's financial strategy. But that's not all...

By following our training course in investment criteria and decision-making, taught by Professor Laurent Gheeraert, you will learn about the time value of money, an important concept in finance that describes how money loses its value over time due to inflation and interest rates. You will learn about the different methods of decision criteria and how to evaluate them against each other to make the best investment choice for your business, project or career.

You will also be able to defend, argue and convince other financial professionals, such as your banker or your company's financial director, to support you in your project. It will be easier for you to increase the number of your professional contacts and build up a network around you.

Finally, you will have acquired the theoretical, technical and strategic skills that will make you a well-informed financial decision-maker... and therefore respected by those in your personal and professional environment.

Objectives

• Obtain and collate the relevant information for analysing a real investment (marketing campaign, purchase of a machine, launch of a new product, recruitment of staff, etc.) or a financial investment (purchase of a share or bond, acquisition of a stake, etc.).
• Analyse and understand the added value created by real and financial projects.
• Demonstrate the essential tools for analysing these projects (Net Present Value, Internal Rate of Return, Payback Period, etc.) and their advantages/disadvantages.
• Make investment decisions based on these appropriate methods and link them to the company's strategy.
• Justify and argue your decision, by understanding the logic behind these criteria.
• Apply all the methods in Excel.

Content Investment criteria and decisions

Discounting and Capitalisation

• Understanding the Time Value of Money
• Introducing the concepts of risk and inflation
• Adding value to equities and bonds

Investment Criteria

• Understand the criteria and rules for investing in a business context: payback period, internal rate of return (IRR), net present value (NPV), certainty equivalent revenue/cost, profitability index, ROI, etc.
• Understand the advantages and disadvantages of different decision-making methods/criteria

Project Analysis

• Analysing the information included in a project
• Selecting projects when there are budget constraints
• Introducing real options

Your Trainer

Next date for this module: Luxembourg, 10 and 11 March 2025