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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: GVTucker who wrote (138112)	7/30/1999 10:51:00 AM
From: Chuzzlewit	Read Replies (2) \| Respond to of 176388

Yes, and another way to look at it is what would the public be willing to pay for an option to buy stock from the company. For example, what would you pay for the right to buy 100 shares of DELL at $5 two years from now? The fact that the company can issue new shares to cover the obligation is irrelevant and should be considered a separate transaction. The company would make the decision to either buy shares or issue new shares when and if the options are exercised. Furthermore, it is not "cheaper" for a company to issue options because the B/S model has nothing to do with market makers or their spreads. It is simply a tool used to calculate the fair value of an option given prevailing market conditions. TTFN, CTC