# Fair Value Formula



## bucket183 (28 September 2009)

Does anyone know how the fair value of options is calculated?


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## mazzatelli (28 September 2009)

Popular models for TheoVal are BSM and Binomial steps. Are you interested in theory, or are you actually after a calculator?


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## bucket183 (28 September 2009)

I guess I am after something that I can put into excel to estimate what a the call will be worth in future (short term).


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## wayneL (28 September 2009)

It would entail inputting the correct future realized volatility into whatever model you're using.

Got a crystal ball?

Fair value is subjective.


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