The Black-Scholes model calculates theoretical option values using five key inputs: stock price, strike price, time to expiration, risk-free rate, and volatility, with higher stock prices and longer expiration periods typically increasing call option values. The model assumes European-style options, no dividends, efficient markets, no transaction costs, constant risk-free rates and volatility, and lognormal returns, although startups may require adjustments for non-quoted shares and estimated volatility. This calculator visualizes how parameter changes affect option valuations across different scenarios, supporting better decision-making for equity compensation planning.
Calculate option values under different share price scenarios with adjustable parameters.
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