One Solution to the Option Pricing Overvaluation Problem: Using Down and Out Call Options

Business Valuation UpdateVol. 17 No. 5
May 2011
Ronald H . Schmidt, Ph.D., AVA
Lawrence Schmidt, M.A.


Introduction Recent articles have pointed to concerns about the validity of using option pricing models (OPM) to determine the value of common stock in 409(a) valuations. At issue is the question of whether OPMs provide appropriate methodologies to estab ...