stock option

n. A right to buy or sell specific securities or commodities at a stated price within a specified time.

stock′ op`tion

n. an option to buy or sell stock at a specific price within a stated period. [1940–45]

Thesaurus

Noun	1.	stock option - the right to buy or sell a stock at a specified price within a stated periodoption - the right to buy or sell property at an agreed price; the right is purchased and if it is not exercised by a stated date the money is forfeitedcall option - an option to buyput option - an option to sell
	2.	stock option - a benefit given by a company to an employee in the form of an option to buy stock in the company at a discount or at a fixed price; "stock options are not much use as an incentive if the price at which they can be exercised is out of reach"benefit - financial assistance in time of need

Translations

option sur titresstock-option

stock option

n. the right to purchase stock in the future at a price set at the time the option is granted (by sale or as compensation by the corporation). To actually obtain the shares of stock the owner of the option must "exercise" the option by paying the agreed upon price and requesting issuance of the shares. (See: stock, share, option)

Stock option

An option whose underlying asset is the common stock of a corporation.

Stock Option

A non-tradeable call option giving an employee at a publicly-traded company the right to buy shares in that company for a certain price. Stock options in this sense are often a part of compensation for major and mid-level executives in large publicly-traded companies. If the share price for the company increases, stock options can be very profitable for the employee. These stock options have certain rules governing when and how the option can be exercised.

stock option

An option to buy or sell a specific number of shares of stock at a fixed price until a specified date. See also call, capped-style option, incentive stock option, put.

Stock option.

A stock option, or equity option, is a contract that gives its buyer the right to buy or sell a specific stock at a preset price during a certain time period.

The exact terms are spelled out in the contract. The same contract obligates the seller, also known as the writer, to meet its terms to buy or sell the stock if the option is exercised. If an option isn't exercised within the set period, it expires.

The buyer pays the seller a premium for the privilege of having the right to exercise, and the seller keeps that premium whether or not the option is exercised. The buyer has the right to sell the contract at any point before expiration, and might choose to sell if the sale provides a profit. The seller has the right to buy an offsetting contract at any time before expiration, ending the obligation to meet the contract's terms.

Stock options are also a form of employee compensation that gives employees -- often corporate executives -- the right to buy shares in the company at a specific price known as the strike price. If the stock price rises, and an employee has a substantial number of options, the rewards can be extremely handsome.

However, if the stock price falls, the options can be worthless. Often, there are time limits governing when employees can exercise their options and when they can sell the stock. These options, unlike equity options, can't be traded among investors.

stock option

noun

Words related to stock option

noun the right to buy or sell a stock at a specified price within a stated period

Related Words

option
call option
put option

noun a benefit given by a company to an employee in the form of an option to buy stock in the company at a discount or at a fixed price

Related Words

benefit