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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?


To: Exacctnt who wrote (71340)7/19/2002 1:01:41 AM
From: Charles Tutt  Read Replies (1) | Respond to of 74651
 
Doesn't use of Black-Scholes suffer from a shortcoming similar to that of pension fund return assumptions (which has recently been suggested as an issue for IBM)? I.e., estimation of the volatility to use in the formula is subject to uncertainty (and hence the potential for abuse).

JMHO, of course.

Charles Tutt (SM)



To: Exacctnt who wrote (71340)7/19/2002 7:29:17 AM
From: John F. Dowd  Read Replies (2) | Respond to of 74651
 
Exac: If they don't get exercised then they are worthless and that are not dilutive they are therefore not dilutive. So how can you have expensed something that was worth NADA? And if this method or any other method results in giving a cost to something that is worthless then that is NOT accurate accounting.JFD