Options Trading Tutorial

Stock options? My company is offering it's employees stock options that we have to option to exercise in a few months. My co-workers were saying that the value of the stock will drop when we can exercise the options because of a lot of people selling the options and getting the cash. I think that the stock will go up because since we dont actually have the stock yet, nothing will be lost when the options are sold...plus some people will choose the option to buy the stock. Who's right???

stock options? I have a Yahoo Portfolio with 2 stock otpions in it. BGOAA.X Call, and BGOMA.X Put, both are for BEMA GOLD company. In one day the Put went up 75.00% and the Call went Up 25.00%. I thought when you held options and one went up in price the opposit option goes down in price? Any input? Thanks

Stock Options? Is anyone familiar with Yahoo! Stock Options Analyzer? I am interested in Straddle Options. Do ALL stock options require margin? Can stock option sbe bought for less than $100.00 per contract (long term expirations)? Thanks.

What's the difference between "restricted stock" and "stock options" from accounting perspective? A quick search on "stock options" shows that many companies are switching from "stock options" to "restricted stocks" as an employee compansation vechicle. Below is what I learned from my research. It could be wrong though. The sales of "stock options" are usually reported as loss. It reduces the company's tax liability, but also adversely affects the company's profit. From 2006, most companies are required to disclose the impact of the "stock options" sales to the public. My questions, When a company issues "restricted stocks" and the employee sells them, is the proceeding counted as "loss" like "stock options"? Why companies don't switch until recently? Does it have anything do to with the new SEC reporting requirement? Thanks,

What happens to my stock options after I leave a company? If I had stock options and left a company and that company got bought. I had already excercised my grant, but did not "excersie" my options (sell the stock). Does it get converted into the stock of the other company? Or do I lose the ability to sell the stock after a certain date and basically lose it all once the other company has completed the sale of stock?

How do I tell the stock options expense of a company? I want to know how much stock options a company is issuing, ie what % of net income is actually being stock options. Example Dell made $3 billion but granted $1 billion in options. I have searched Google everywhere and it doesnt give anyway to find this out?

What happens to unvested stock options when a public company goes private? If a public company gets taken over by private equity investors, what is the typical handling of employee stock options ? The stock options are given as incentive, so it would be unfair to ignore them even if they are unvested. On the other hand, determining a fair value for them is difficult. Would love to hear from people who have gone through this process or have the legal expertise to comment on this situation.

How do stock options work if a company is not public? I just got hired at a company that is private but would like to be bought out eventually, how would stock options work being that the company is a private company but could eventually be bought out by a company that is public?

How do Stock options work and would I still be entitled to them If I left the company that issued them to me ? I've been working with this company for 2 year and we were promissed stock options after being with the company for a year. They are in the process of drafting them now. I dont see myself staying with the company for long but I dont want to lose the opportunity to cash in on these 2 years of hard work that I put in to build the company up now that they are looking to go public or take a private placement. How do they work exactly?

What happens to employee stock options when a company is bought out? My current company just announced that it is being purchased. What happens to my employee stock options? Do they convert to the new stock or do they immediately vest at the current price?

What happens to a company's stock options when the company is acquired by either a private or public company? In other words, if I buy a call option that expires in January 2010, and the company is aquired before that time, what happens to my right to buy shares in the acquired company? Am I compensated for the call option at the time of the acquisition? If so, at what price? Does my option (and right)disappear? If the acquiring company is a publicly held company, I assume that the options just convert to an equivalent stock option in the acquiring company. Is this correct?

What's the difference between stock options and unrestricted stock? I've received a bonus from my employer as unrestricted stock options which will vest in one year. Additionally, when I started with the company, they gave me a small amount of shares as options which vest in four years. What does all of this mean, and what are the differences between the two? Please answer in layman's terms if you can---I'm no good with following money terminology.

What does it mean to exercise stock options? I've noticed in the past few weeks at the company I work for (a 6-billion dollar company) the officers are exercising their stock options. The company is receiving cash from the transactions. What does it mean to exercise stock options?

How do you determine whether to buy stock options? I work for a startup. I have vested stock options. I am leaving the company to go to another career. How do I know whether I should buy my stock options?

Should unvested stock as well as stock options be taken into account when evaluating the net worth? Or, in other words, what value should be given from a credit risk to a net worth of a borrower that consists of unvested stocks and stock options related to the company he's working for? Should that value be brought back to zero because if for instance the borrower would leave his company, those unvested stock and stock options would remain ownership ofthe company?

What happens to a company's stock options when the company is acquired by a public company? i assume they are converted to the public company stock 1-for-1 or on another agreements stipulated in the purchase. but what happens to the vesting schedule? are they automatically vested once the purchase is complete and options are converted or do they keep the same vesting schedule. ex. i have 1000 shares, 500 are non-vested at the time of purchase. a) nothing. they keep the same vesting schedule b) acquiring company dictates new vesting schedule based on their stock policy. c) they are all automatically vested once purchase is complete.

When a company gets acquired, what usually happens with unvested stock options and RSUs? My company is about to get acquired, and I was wondering what will happen with my yet to be vested stock options and RSUs (restricted stock units). And while we're at it, what about the vested stock options?

Should I exercise my stock options or take the cash settlement for tax purposes? The company I work for has been purchased by an international company and the deal willl close in sept. I have unexercised iso stock options that are worth $180m. If I do not exercise them, I will be paid in cash when the merger closes in Sept. I will make about $200m in regular salary this year. I want to MINIMIZE the taxes I will pay on my iso's. Based on my salary, I know if I exercise the options I will have to report the value for AMT purposes. Would I be better off excercising the options (my old company stock would be converted to the new firms stock) and holding it for at least a year and dealing with AMT or just taking the cash and reporting it as regular income. Is their a tax advantage either way? Thanks

How do company stock options work? I might be working for a place that has nice benefits and also gives you "stock options" I'm not sure what this means though. How does it work? Can someone please explaing this? Thanks!

What's the difference between stock and stock options? Much of CEO pay has taken the form of stock options rather than grants of stock.Which form of compensation gives the CEO greater incentive to increase shareholder value: one million dollars in stock or one million dollars worth of stock options?

How do i account for Stock Options as a gift from a customer? uk question. I know how they work if you are an employee. However, i'm a director and basically work for myself. One of my customers has paid me in full for the service i provided. I know i need to account for this in this tax year. However, they also gave me stock options that mature in 3 years time provided i don't provide my services to thier competitors. fair enough. So when do i account for these stock options ? I can't do it this years as they haven't matured so i don't know what money i've made. I'm likely to vest them in 3 years time as the options already have a a healthy profit. Hows that going to work as i've already accounted for the service in full. I'm wondering if they count as a new 3 year service - the "service" being to NOT talk to thier competitors. me ? Confused. I guess i'll have to talk to my accountant but thought i'd ask here to see if anyone knows. my customer is in the US but i don't think that matters....

how to start earning stock options for ceo TOONTOWN? ok so u know how u go in the things like.. the front three, back nine.. those things and you earn stock options? well ive never been in the CEO and idk what you have to do to start earning stock options to be able to ceo. i just went into "the front three" but nothing happened. please help!

In which state are my stock options taxable? I have been living in Illinois for several years. I just exercised some stock options. I got these options in 1997 while living in Maryland. The grantor, my former employer, sent me a check and withheld a bunch of Maryland state taxes. (They had my address screwed up in their computer.) Even though we've now corrected my mailing address, they won't fix the check to switch the withholding to Illinois. They are saying the sale of options are taxable in Maryland because that's where I lived when the options were granted. Is this true or are they just too lazy to fix it?

What are the tax implications of taking up employee stock options? I imagine if its treated as income then its liable to income tax? Is it as simple as this? Is there any way of issuing stock options without this tax implication?

What are the steps for loading some stock options(Investing) from a home based job? I live in Canada and I have a website that has some customers so I'm earning some money. I want to load stock options.What should I do? I have to register and start a company and have a trade mark? Or there's no way but finding a job offer who's interested in my site for sharing stocks? I'm really confused.

What is the best sector of the stock market as a beginner, to buy stock options? I want to begin buying stock options, but I do not know what sector of the market to start in this economy. I am looking only for moderate return on my investment. I only want to get my feet wet so to speak, and not get burned. My funds are very limited. Any suggestions?

What are some good investment newsletters or strategies for stock options? Hi Please advice if anybody have tried a good investment newsletter for stock options? Is there a listing to rank the performance of stock option newsletters? Thank you for your help

Can I defer capitol gains when I sell my stock options by investing the proceeds in a primary residence? Can I defer capitol gains when I sell my stock options by investing the proceeds in a primary residence? I know some taxes on investments can be defferred if rolling into a house (like an IRA). I'm just wondering if selling Incentive Stock Options can also be rolled into a primary residence to defer the taxes. Alternately, what about rolling the capitol gains into an IRA?

The company has withholding tax from stock options in divorce,how wud we pay the tax from the non employee ? The company has withholding tax (federal and state(CA) from stock options in divorced couple, the husband is the employee.How would the company remit the withholding tax from the wife's(non employee's) share in IRS and CA FTB?what forms need to file by the company?

Where Can I Learn How To Trade Options In The Stock Options Market? I've heard that trading in the stock options market can be very rewarding but where can I learn how to do this?

Is there any tax advantage to buying a home with stock options? If I'm buying a home and want to exercise and sell some stock options to pay for part of it, is there something I can do to reduce the short term capital gain taxes? Specifically, does the 1031 exchange apply here?

What is the best online platform for trading stock options? I'm currently with sharebuilder because they didn't require a minimum... I've since gotten heavily invested into stock trading/option trading... I don't believe this is the best site for trading options, because I cannot find some of the quote symbols I find on other sites. Let me know.

Do you know if I can write off stock options losses? My 1099 had all of my stock purchases and sales, but didn't list my stock options, so when I went to my accoutant she didn't see them and I thought I had had more than the losses she calculated. I had a lot of stock option losses and gets me to the max 3k for the year. Thanks!

Can the offering of stock options in return for services be construed as employment? In a relationship in which an individual offers services in exchange for stock options, will the nature of that relationship (i.e. whether it is an employer/ employee or contractor/contractee relationship) depend on the nature of the services (e.g. whether the services are provided at the Company's residence) etc?

Is it better to surrender or Exercise stock options? If you have stock options at the company where you work and that company gets acquired you have two choices. You can either surrender your options and take a cash payout or you can exercise your options and still take the same payout but aparently there are different tax implications for each case. What are the differences? Is it better to do one or the other?

How can I find out what some old stock options are worth? I have some common stock options in a company called Computer Complex, Inc. (incorporated under the laws of the state of Delaware) purchased in 1970. How can I determine their worth?

How Do I Take Advantage of Stock Options From My Last Job? I received stock options at my last job and in July they are supposed to "vest". Problem is, I don;t work there anymore and I am out of contact with them. I have the signed document from the CEO and CFO granting me the publicly traded options, but I just don't know what to do with it now. Obviously, this is my first time with this sort of thing. Could anyone give me an idea as to what I can/should do with this document?

Can I sell stock options even if I have not purchased them yet? I received 400 stock options through my company a few years back and have not had the opportunity to buy them. I want to know if there is a way of selling those options instead of having to purchase them.

How and what do you need to know to start playing in stock options market? What are the pitfalls, benefits, capital required, investment knowledge, to be able to play in stock options market to be relatively safe.

How do stock options affect the price level of stocks? How can a derivative exert this pressure on the underlying asset? My impression is that supply/demand of options effects the intrinsic price levels of those options in the market wherein they trade... but how can they affect the actual stock? Thanks in advance!

What are the market hours for stock options trading? Regular stock hours are 9:30 till 4 but, there are pre and post hours is there anything like that for options trading?

What is the best place and what are the requirements there to do stock options trading? Looking for a place to do stock options trading and experiment with a couple of trades first. Any recommendations? Well Nick, you are just full of fear aren't you? Apparently you are doing quite well at it and don't want anyone else in or else you are to ignorant to be able to do it yourself. When you tell somebody that something is not worthwhile, how about next time descibing a situation that looks profitable and explain why I might loose money doing it? Then maybe your arguement might have merit!

Can I use 2007 W-2 income from exercise of stock options and deferred compensation to contribute to an IRA? I am retired and receive payments from a deferred compensation plan and also had stock options that I exercised in 2007 all of which were reported as income on a W-2 from my company - can I use this income to contribute to an IRA

i own stock options in a private company. How can i learn the value of the stock? how can i find the value of private stock options i own ? Are there periodic reports issued by management, periodically reqired government reports, periodic reports to investors, etc? What

Do expired Incentive Stock Options (ISO) qualify as a tax deduction? I had a bunch of Incentive Stock Options (ISO) expire when I left my last employer. These options had been granted to me years before and I was fully vested but never exercised them. Can I write off the intrinsic value of the options at the time of expiration as a capital gains loss?

Is there a source that records historical prices of stock options? I'm looking at investing in stock options and would find it very useful to be able to compar how the specific option has reacted to price changes in the underlying. I can't seem to find any source for this kind of information. Any suggestions?

How do I get started on stock options? Pro/cons stock options what stocks to pick What program do I work with? What fees are involved when trading? I work full time- I'm looking for something that only needs about once a week for checkup? any recommendations?

Offering stock options in a offer letter? My offer letter states that I will be able to purchase a certain amount of stock options from my company. I've been with the company for about 2 months and haven't received the agreement letter from them. The company has now been sold. How should I bring up the discussion that my offer letter states a certain amount of options are owed to me, and how binding is the offer letter as far as agreements are concerned. It is binding? Can a company state that you will be given x amount of options on your offer letter and then not go through with it. Are there legal requirements?

What would you tell a guy about old GM stock options? He has a ton of options to buy the old GM stock at 45 to 75 dollars per share. They would seem to be absolutely worthless. Some of them do not expire till 2018. I told him I'd get back to him.

My company may be acquired: What are my tax issues related to stock options? The company I work for may be getting acquired. I have a significant set of stock options that have or will vest upon the acquisition. I have not exercised these options. The stock options could be worth between $1-3 million. What are my tax obligations if the company is acquired for cash. Does it change if it is acquired for stock? Is there anyway to reduce the taxes that I will have to pay?

Is it illegal to backdate stock options at the highest price & distribute them to employees? Is all backdating illegal? Is this particular situation illegal if the CEO is backdating stock options to the highest price and distributing them to executives and company employees? Would the CEO be able to write off more $ in taxes if the stock price is higher?

How and where to find free data on historical volatility of Indian Stock options? Is it available on yahoo? Historical and implied volatility datas are required to calculate and compare the under pricing/over pricing of stock options in the financial markets such as stock exchanges.

Are taxes withheld and reported on W2 for employee stock options? When exercising employee stock options, are taxes automatically withheld by the employer and reported on the w-2 so therefore no 1099-B needs to be filled out. It looks like I overreported withholding in 2005 according to the IRS and it appears because I doubled up the withholding for the stock exercise. Thanks

What Is The Best Way To Trade Stock Options? There are plenty of methods when it comes to trading stock options and I've come across several different systems to use, but does anyone know of one that really works?

What to do with Money from Vested Stock Options? My company has been bought by a private firm and all of our stock has vested. What should I do with the money? Can I roll it into my 401k? Should I put it in some sort of savings acct.? What will be the best in terms of taxes? Any other options?

What does it usually mean for a company when directors, officers start exercising stock options & sell them? Don't know if I worded correctly but the article I read said they've exercised options for shares of common stock and sold them in the same day. Didn't know if this is a sign of the company going private or what. Thanks!

Can anyone tell me about the concept of day trading and of stock options? I've read a lot on day trading and stock options, but I don't completely understand how it works and how the concepts are applied and carried out on a regular basis. Can you explain to me how they work based on the concepts?

Do I have any rights for bad stock options? My husband has 1205 stock options all of which are worth nothing after 8 years of service. The company has been so kind as to offer a whopping $269.55 for ALL of the stock. Do we have any legal rights to ask for a better compensation. They did have some major problems with SEC and were taken off the market because of it. Now they are back on. The company is Maxim Integrated Products or MXIM on the market.

What do stock options do for me? How do I use them? I just got a job offer that includes 15,000 in stock options. I'm guessing this is a good thing (the other benefits are great) but I really don't understand what stock options are and how to use them. Does this mean I can buy 15,000 in stocks? Couldn't I buy them without stock options? Imagine a scenario where company A offers salary X plus 15,000 in stock options, but company B offers salary X + 15,000 with no stock options. Which would you pick?

How to value executive stock options? And how can someone value excutive stock options with blackout periods? Can someone explain this to me? Thanks!

With Apple's current stock options right now, how can there be ask prices without any bids? Morningstar has a nice new Options tab, and I've had fun looking at what prices Apple options have been going for. For a call that's going to expire in three weeks, some options writer wants 5 cents per share on Apple stock at a strike price of $230. But there's no bids put in, as far as I can tell. Does that mean this option writer has not been able to find a willing buyer? What does this mean when there's an ask price but no bids? Thanks for your help.