Comment on Reddit wants to raise $748M with IPO, sets value at $6.4B

• GissaMittJobb@lemmy.ml ⁨8⁩ ⁨months⁩ ago

  Are you talking about writing them off?

  Options come with the obligation to pay for the underlying asset, so unless they are valued above the strike price, they are effectively worse than worthless.

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  • SpaceNoodle@lemmy.world ⁨8⁩ ⁨months⁩ ago

    Is it just options specifically, or grants, or …?

    Would the reported compensation be at the strike price, or the current valuation, or the difference?

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    • GissaMittJobb@lemmy.ml ⁨8⁩ ⁨months⁩ ago

      Face value is unlikely to be the amount reported - I doubt the options are granted below the last reported market rate. Hence it’s probably relative to the amount of underlying stock the options represent.

      You’d have to check the SEC-filings for more accuracy than that.

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    • WildPalmTree@lemmy.world ⁨8⁩ ⁨months⁩ ago

      Not American, but I would assume the Black-Scholes model will be used for valuation.

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  • WildPalmTree@lemmy.world ⁨8⁩ ⁨months⁩ ago

    Options can come with or without the obligation to buy the underlying asset. I’d assume they will never be worth less than worthless.

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    • GissaMittJobb@lemmy.ml ⁨8⁩ ⁨months⁩ ago

      Less than worthless would be when exercised, not exercising would be worth 0 - unless you paid for the option contract, in which case not exercising would represent a loss.

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