An important special case of a strategy problem is the portfolio problem, in which the various decisions faced in the strategy are of a similar nature, and the decision maker does not have sufficient resources for funding all combinations of alternatives. An example is an investment portfolio, in which the decision maker is aware of a good number of investments he would like to make, but is unable to afford all of them. Especially in situations like this example, people sometimes address the problem as one of performing a prioritization of the various opportunities. If one opportunity is prioritized higher than another, then, in the case of limited resources, the decision maker would prefer to invest in the former than in the latter. A is a decision.
Some decisions offer the opportunity to adopt a particular type of alternative called an option .
An option is an alternative that permits a future decision following revelation of information. All options are alternatives, but not all alternatives are options. To pay money now to reserve the right to drill after geological testing is done is an alternative that is also an option. Options, as an important type of alternatives, have the potential of adding value to a decision situation. A wise decision maker is alert to that possibility, and actively searches for valuable options.