Today I received a stock option grant for the company I am working for. Traditionally, the stock options for this company have done VERY well and I am hoping that mine will do the same. We shall see.
These options vest on a 1/3, 1/3, 1/3 schedule. I will be fully vested after 3 years. There is a 10 year expiration on them and I can receive a cash payment for them at anytime after they vest – I don’t need to go to the market to exercise.
The question that I am pondering is whether I include these options as part of my net worth. I think I should. Once they vest, they are essentially a part of my stock portfolio. They will move up and down in value as the company’s share price moves. At any given time (once they vest of course), I can sell them and realize the gain. The only real difference between these “shares” and my other share holdings is that if these are below a certain price, then I have not made anything and I have not lost anything. It is my money and I plan to parlay the earnings into other investments. Let me know what you all think….