Terotechnology

Dictionary Says

Definition of 'Terotechnology'


A word derived from the Greek root word "tero" or "I care", that is now used with the term "technology" to refer to the study of the costs associated with an asset throughout its life cycle - from acquisition to disposal. The goals of this approach are to reduce the different costs incurred at the various stages of the asset's life and to develop methods that will help extend the asset's life span.

Terotechnology uses tools such as net present value, internal rate of return and discounted cash flow in an attempt to minimize the costs associated with the asset in the future. These costs can include engineering, maintenance, wages payable to operate the equipment, operating costs and even disposal costs.

Also known as "life-cycle costing".

Investopedia Says

Investopedia explains 'Terotechnology'


For example, let's say an oil company is attempting to map out the costs of an offshore oil platform. They would use terotechnology to map out the exact costs associated with assembly, transportation, maintenance and dismantling of the platform, and finally a calculation of salvage value.

This study is not an exact science: there are many different variables that need to be estimated and approximated. However, a company that does not use this kind of study may be worse off than one that approaches an asset's life cycle in a more ad hoc manner.

comments powered by Disqus
Hot Definitions
  1. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  2. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  3. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  4. Momentum Investing

    An investment strategy that aims to capitalize on the continuance of existing trends in the market. The momentum investor believes that large increases in the price of a security will be followed by additional gains and vice versa for declining values.
  5. Momentum Investing

    An investment strategy that aims to capitalize on the continuance of existing trends in the market. The momentum investor believes that large increases in the price of a security will be followed by additional gains and vice versa for declining values.
  6. IPO ETF

    An exchange-traded fund that focuses on stocks that have recently held an initial public offering (IPO). The underlying indexes tracked by IPO ETFs vary from one fund manager to another, but index IPO ETFs are usually passively managed and contain equities that have recently been offered to the public.
Trading Center