Feb
06
Learn Finance with the pros. Better articles, resources and screencasts for easier learning.
This 50-minute tutorial explains the mechanics of the binomial and the intuition behind the Black-Scholes. We also consider the essential differences, from a valuation standpoint, between a traded option and an employee stock option (ESO): long life and illiquidity. We walk through the calculation of option value in the spreadsheet. In less than one hour, you will be able to price options!
(50 min.)