NSSC Blog: Before You Invest

Question of the week: What are employee stock options?

In pop culture you may have heard the term “stock options” bandied about. In TV shows or movies someone gets a job and it’s the best because they get employee stock options. So, in this context what exactly are employee stock options?

Stock options are an incentive that publicly or privately traded companies can offer their employees. It is a contract that gives an employee the right, but not the obligation to purchase shares of a stock at a set price on or before a specific date.