Protecting Your Employee Stock Option Gains
- Topics:
- Stock Options
- Tags:
- Benefits,
- Stock Options,
- Insurance,
- Human Resources,
- Gain,
- Financial Planning,
- Finance,
- Employee Stock Option,
- Corporate Insurance,
- Business Operations,
- ...
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Overview: You wouldn't think of driving your car without insurance. You are concerned about your liability if something goes wrong; therefore, you purchase insurance. In the same way automobile insurance protects your liability (i.e. against potential loss), listed options can protect you from potential loss of your hard-won gains in your employee stock option. Simply, you can purchase PUT options to protect your gains while allowing you to continue participating in your company’s growth. PUT options are those which give the owner the right to sell a security at a fixed price during a fixed period of time. To protect your gains, you take out a little insurance. You call your broker and you purchase PUT options on your company’s stock that entitle you to sell stock during the next several months at $75 per share. Now you are guaranteed the money will be there when you need it.
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Format: HTML | Date: Nov 2000 | Pages: 1
