Here a 2nd PROOF, ie. the final nail into the coffin of this buggy IB calculatorPROOF WHY THE IB OPTION CALCULATOR IS WRONG AND IS BUGGY:
It is said that b/c with American Style options one can exercise anytime (as opposed to the standard European Style where exercise can be done only at expiration), then it has to be more expensive than European Style options. That's their own argumentation!
But take a closer look: this buggy calculator even calculates exactly the opposite! Ie. double-buggy IMO!
"The correct premium should be 13.892037, not 13.77678."
Forget this Cox-Ross-Rubinstein crap pricing method and that IB calculator which uses it!
Here's a better calculator based on Black-Scholes-Merton (BSM):
http://www.option-price.com/index.php
:It's the options calculator of the famous iVolatility.com site.
See how it says "American" and still gives the same result as the BSM method!
That's what I was saying all the time! Q.E.D.2
