Pay · HR glossary

Stock Options

Stock options give the holder a right to buy specified shares at an agreed exercise price, subject to the plan's conditions and time limits. They do not necessarily confer immediate share ownership.

Example

An employee's vested option permits buying shares at ₹100 each; whether exercising is worthwhile depends on value, costs, taxes and the ability to hold or sell the shares.

What to keep in mind

Vesting and exercise are separate events. Read expiry, leaver and liquidity terms carefully, because an option may lapse or provide no gain even after it has vested.

Further reading

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