Comments on: Valuing Employee Stock Options with Zions http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/ The Business of Technology Tue, 02 Dec 2008 11:11:11 +0000 http://wordpress.org/?v=MU hourly 1 By: Trying to Be like Bill Gates » CORRECTED: Take-Two plans for growth (Reuters) http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-842834 Trying to Be like Bill Gates » CORRECTED: Take-Two plans for growth (Reuters) Thu, 10 Jan 2008 21:37:13 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-842834 <p>[...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]</p> [...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]

]]> By: SEC Allows Market-Based Options Expensing… Though Questions Linger | bitbucket.kylewelsh.com http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-648119 SEC Allows Market-Based Options Expensing… Though Questions Linger | bitbucket.kylewelsh.com Mon, 05 Nov 2007 04:03:12 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-648119 <p>[...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]</p> [...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]

]]> By: El Mike’s Internet News Blog » Blog Archive » SEC Allows Market-Based Options Expensing… Though Questions Linger http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-644530 El Mike’s Internet News Blog » Blog Archive » SEC Allows Market-Based Options Expensing… Though Questions Linger Fri, 02 Nov 2007 22:15:42 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-644530 <p>[...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]</p> [...] model, the SEC seemed much more willing to along with it. The latest is that the SEC has now approved Zions’ plan for options expensing based on publicly traded derivatives. The story at Gigaom provides some of the reasons why this [...]

]]> By: Jean Sini http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-640032 Jean Sini Thu, 01 Nov 2007 02:59:55 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-640032 <p>Great analysis!</p> <p>Of note, Google's transferable ESOs. As per the Wikipedia reference below, they can be auctioned by employees on a secondary market run by Morgan Stanley.</p> <p>http://en.wikipedia.org/wiki/Option_%28finance%29#_note-9</p> Great analysis!

Of note, Google’s transferable ESOs. As per the Wikipedia reference below, they can be auctioned by employees on a secondary market run by Morgan Stanley.

(link)

]]> By: me http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-639756 me Wed, 31 Oct 2007 22:56:29 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-639756 <p>With the acronym ESOARS, how can you say the idea won't take off - it's a natural!</p> With the acronym ESOARS, how can you say the idea won’t take off - it’s a natural!

]]> By: Wednesday links: fee machines « Abnormal Returns http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-639383 Wednesday links: fee machines « Abnormal Returns Wed, 31 Oct 2007 18:56:12 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-639383 <p>[...] Companies are still trying to devise systems to help price and transfer employee stock options. (GigaOM.com) [...]</p> [...] Companies are still trying to devise systems to help price and transfer employee stock options. (GigaOM.com) [...]

]]> By: sc http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-637746 sc Tue, 30 Oct 2007 23:18:17 +0000 http://gigaom.com/2007/10/30/valuing-employee-stock-options-with-zions/#comment-637746 <p>Kudos, a fantastic analysis of the issue!</p> <p>If the derivative instrument is so vastly different from the underlying asset it is supposed to value, why not just stick with Black-Scholes and let FASB specify what the inputs to the model should be, with option duration as a function of attrition rate, vesting schedule etc...It will be cheaper for companies to do this using a standard formula than creating a marketplace, and not necessarily less accurate than the method suggested by Zion.</p> Kudos, a fantastic analysis of the issue!

If the derivative instrument is so vastly different from the underlying asset it is supposed to value, why not just stick with Black-Scholes and let FASB specify what the inputs to the model should be, with option duration as a function of attrition rate, vesting schedule etc…It will be cheaper for companies to do this using a standard formula than creating a marketplace, and not necessarily less accurate than the method suggested by Zion.

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