haku: @indexterm VALUATION / yhteensä: 677
viite: 391 / 677
| Tekijä: | Cuny, C. Jorion, P. |
| Otsikko: | Valuing executive stock options with endogenous departure |
| Lehti: | Journal of Accounting & Economics
1995 : SEP, VOL. 20:2, p. 193-205 |
| Asiasana: | VALUATION EXECUTIVES STOCK OPTIONS |
| Kieli: | eng |
| Tiivistelmä: | Executive stock options differ from exchange-traded options because of vesting and portability restrictions. Executive departure from the firm forces early exercise, reducing the value of executive options. Current methodology calculates the option value by multiplying the Black-Scholes option price by the departure probability. This ignores the possibility that executive departure is less likely when the stock price is high, and thus is correlated with the stock price. The authors show that this correlation implies a substantial increase in option values. |
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