Table:
|  | Number of Shares | Weighted Average Exercise Price Per Share |
| --- | --- | --- |
| Outstanding at January 1, 2018 | 4,376,474 | $0.16 |
| Granted | 67,394 | 0.17 |
| Exercised | – | – |
| Cancelled or expired | (1,094,075) | 0.14 |
| Outstanding at December 31, 2018 | 3,349,793 | $0.16 |
| Granted | – | – |
| Exercised | – | – |
| Cancelled or expired | – | – |
| Outstanding at December 31, 2019 | 3,349,793 | $0.16 |
Paragraphs:
Transactions involving stock options issued to employees are summarized as follows:
The expected life of awards granted represents the period of time that they are expected to be outstanding. The Company determines the expected life based on historical experience with similar awards, giving consideration to the contractual terms, vesting schedules, exercise patterns and pre-vesting and post-vesting forfeitures. The Company estimates the volatility of the Company’s common stock based on the calculated historical volatility of the Company’s common stock using the share price data for the trailing period equal to the expected term prior to the date of the award. The Company bases the risk-free interest rate used in the Black-Scholes option valuation model on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent remaining term equal to the expected life of the award. The Company has not paid any cash dividends on the Company’s common stock and does not anticipate paying any cash dividends in the foreseeable future. Consequently, the Company uses an expected dividend yield of zero in the Black-Scholes option valuation model. The Company uses historical data to estimate pre-vesting option forfeitures and records share-based compensation for those awards that are expected to vest. In accordance with ASC 718-10, the Company calculates share-based compensation for changes to the estimate of expected equity award forfeitures based on actual forfeiture experience.
Question:
How is the volatility of the Company's common stock estimated?
Answer: based on the calculated historical volatility of the Company’s common stock using the share price data for the trailing period equal to the expected term prior to the date of the award