Performance Rights Valuation Tool

Peloton Corporate has created a free options/performance rights calculator which enables calculation of option/performance rights values using the following inputs:

• Grant date share price (or estimate of value if your entity is unlisted)
• Exercise price
• Estimated share price volatility
• Time period to expiry
• Riskless rate of return at grant date (bond rate)

Both Black-Scholes and Binomial option pricing models are employed in the calculator. However, the calculator does not take into account any performance hurdles or other vesting conditions. These are complex issues with respect to which you should seek advice.

This calculator is useful to start the conversation about the value of options/performance rights which are being considered by the board and to provide a basic estimate of AASB2 expense.

Disclaimer: The reliability of the options/performance rights calculator is entirely dependent on the reliability and appropriateness of the inputs.

Most listed and private company options and performance rights only vest when performance hurdles are partially or entirely achieved.

Performance hurdles (such as absolute return measures or relative performance measures) are usually complex and require Monte Carlo simulations to reliably assess.