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Strategies & Market Trends : Employee Stock Options - NQSOs & ISOs

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To: Don Lloyd who wrote (684)8/1/2004 9:09:23 PM
From: rkralRead Replies (1) of 786
 
Don, re "You consider it an advantage that a totally arbitrary stock price on an arbitrary day is used?"

Among other things, the option value is based on the stock price on the date of the grant. That's hardly arbitrary. Indeed, there is no other date more appropriate IMO.

re "If you try to convert [ed: 5% of the company] into dollars, the result will be no more accurate and useful than a stopped clock."

Each option is like a lottery ticket we buy for $1. Winners don't pay more for their tickets after they win ... and the losers don't get their $1 back. The lottery ticket price is fixed ... at $1. IOW the price is a "stopped clock". Why shouldn't it be stopped?

Ron
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