4 ms·
I think you answered the question yourself in the last three paragraphs. 1. Are you given enough stock options such that the difference between the strike pric
by argonaut 14y ago
I think you answered the question yourself in the last three paragraphs.
1. Are you given enough stock options such that the difference between the strike price and the "actual stock price" (how did you even determine the "value of stock"?) is equal to the cash you would receive otherwise?
- saxmrussell 14y agoLet me rephrase then: s/value of stock/price of stock as determined by management/
- argonaut 14y agoThat's only even more confusing. The strike price is by law supposed to be the "fair market value" of the stock option. So what do you mean by the "price of stock as determined by management." While the strike price is typically kept artificially low by use of 3rd-party audit firms that calculate valuations, how do you know management is not artificially inflating the price of stock (so as to give you a misconception of the worth of the stock). Also, you should make clear what the cash equivalent of stock is. Is it cash = cumulative difference between strike price and "price of stock as determined by management"?
- johnrgrace 14y agoThe strike price doesn't have to be "fair market value" by law, but if the price is under the price then it becomes current taxable income.