Exercising Incentive Stock Options by Exchanging Stock for Stock: A Means of Building Individual Wealth
Journal of Financial Service Professionals, Vol. 59, No. 2, pp. 55-59, March 2005
Posted: 23 Sep 2011
Date Written: March 1, 2005
Abstract
Anecdotal evidence suggests that the recent controversy surrounding the expensing of stock options appears likely to reduce the number of options granted. Therefore, it becomes increasingly important for grantees to manage the grants that they have received in order to maximize grantee wealth. A feature of incentive stock options (ISOs) allows them to be exercised through the exchange of currently owned shares, without initiating a taxable event. For certain grantees, this approach may be an attractive alternative in building wealth.
Keywords: stock options
JEL Classification: M52
Suggested Citation: Suggested Citation