There are different types of preferred stocks that can be issued by companies and purchased by investors. These stocks are mainly issued by companies who do not want to dilute control but want to raise funds from investors. We shall look at the various types of preferred stocks hereafter but first, let us understand the … Read more
There are different types of options with various criteria for classification. An option is a financial derivative that confers on its recipient the right to buy the underlying at a specified price, in a particular quantity, within a stipulated time frame. Here, the various types of options will be discussed; but before we do that, … Read more
Stock options and restricted stocks are forms of employee equity compensation given by employers. With these compensations, employees gain a stake in their companies and get the opportunity to hold partial ownership of the business and its profits. Stock options as well as the two types of restricted stocks (RSA and RSU) are generally the … Read more
How are RSUs taxed? The taxes on RSU is different from other forms of equity compensation like stock options. When it comes to RSU taxes, there is no immediate tax liability when a restricted stock unit is awarded. The RSU tax treatment is only applicable when vested and the recipients receive the actual payout of … Read more
Stock options and RSU are forms of employee equity compensation that employers give to employees. They are generally the most common forms of equity compensation. Despite their similarities, stock options vs RSU differ in terms of how they are taxed, their vesting, and the form of compensation that the employee receives. Hence, they are entirely … Read more
Call and put options are types of equity options that give their holders, otherwise known as the buyer the right to buy or sell the associated underlying shares of the options. These options are traded on major exchanges like New York Stock Exchange Arca (NYSE Arca) and New York Stock Exchange America (NYSE American), because … Read more
Repricing stock options implies changing the price of stock options when the market value of stocks falls below the initial grant price. The purpose of this is to give room for the employees to exercise underwater options at the new grant price. If for example, the initial exercise price also known as the grant price … Read more
Options refer to financial derivatives that give buyers the right, but not the obligation to either buy or sell underlying assets such as stocks, bonds, commodities, etc., at a predetermined price and date. These derivatives comprise call and put options. Put options allow buyers to profit when there is a decline in the price of … Read more
Incentive stock options tax treatment was created by the Revenue Act of 1950. The stock option grants became popular in the following decade as a form of compensation for executives and employees. These contracts give the holder the right but not the obligation to buy or sell a stock at an agreed-upon price and date. … Read more
Stock warrants and stock options differ in many ways but are also similar which can be confusing to people. The terms stock warrants and stock options are frequently used when talking about financial investments, but not everyone is aware of the differences between the two; even investors who deal with stocks on a daily basis … Read more
