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Well, kind of the whole idea is that maybe they will be worth more than the cash in the future.
by draw_down 9y ago
Well, kind of the whole idea is that maybe they will be worth more than the cash in the future.
- moron4hire 9y agoWhen a company gives you options instead of cash, they are making a bet with you that they can make a better return on the cash than you can. They are hoping they can convince you that cash_in_your_hand_now < value_of_shares_in_the_future, but in order for them to even consider making the bet, they have to expect that value_of_shares_in_the_future < cash_in_their_hand_now.
- draw_down 9y agoYes, and things don't go as expected 100% of the time. Again, that's the whole idea here.
- poikniok 9y agoGreat argument for paying people in lottery tickets!
- draw_down 9y agoI mean, yeah. That's what this all is, that's why people refer to options that way. Thing is, people win sometimes.