Employee Stock Options - Service 1 Example
Example Customer Need for Service 1
"I have just received an offer from a company that I am considering for employment. They have offerred me a hiring incentive of options for 3,000 shares of company stock with a strike price of 30, but that is the same price as their stock is today. Are these options worth anything? If so, how much are they really worth? This information will help me to assess the full benefit of their offer."
Example Customer Inputs for Service 1
Example Output to Customer for Service 1
On first glance, you might not think the options they are offerring you are worth much because your options are allowing you to buy the stock at 30 and you could buy the stock at 30 right now anyway. But the truth is that you would have to lay out a lot of money to buy 3,000 shares of stock at 30 right now - about $90,000. But with the options, you don't have to do that. You can participate in the gain in the stock, above 30, for ten years. So it really is worth something right now, and thanks to Nobel Prize winning formulas, you can find out what the fair value of those options are today.
The theoretical fair value for the options, based on the inputs you provided and the underlying assumptions of the Option Pricing Model, are $16.58 for each share of stock that you have options for. Options to purchase 3,000 shares of stock, at a strike price of 30, with an expiration date of 6/21/2013 are worth $49,740.00 right now, based on this fair value calculation. Congratulations! Your company has offerred you a nice hiring incentive!
Additional data used in the fair value calculation for this particular case only:
- XLNX Current Price: 30
- XLNX Volatility: 40%
- Interest Rate: 3%
- Annual Dividend: None
Example Benefits to This Customer
This customer was offerred a very substantial hiring incentive, but because he wasn't sure how to value it, he did not understand what this incentive was really worth. Without that knowledge, he might accept another offer with a slightly better salary and no hiring incentive. After using our service and finding out the truly substantial incentive ($49,740.00) he was being offerred, the Xilinx offer moved up to the top on his preferred list of potential employers. Needless to say, this service made a substantial increase to his net worth for the year.
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Find Out the Fair Value of Your Options Now and make Projections for the Future!
Use our employee stock option analysis services to find out the fair value of your options right now and make projections to see what they should be worth in the future. Pick the best time to exercise your options and find out how much money you will walk away with. Maximize Your Retirement Funds!
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