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Definition of

stock option plan

Stockholding & Investments

employees' right to buy company stock a program in which an employee is given the option to buy a specific number of shares of stock at a future date, at an agreed price. Stock options provide a financial benefit to the recipient only if the stock price rises over the period the option is available. If the stock price falls over the period, the employee is under no obligation to buy. There may be a tax advantage to the employees who participate in such a program. Share options may be available to all employees or operated on a discretionary basis.

Related definitions of "stock option plan"

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Definitions of ’stock option plan’ and meaning of ’stock option plan’ are from the book publication, QFINANCE – The Ultimate Resource, © 2009 Bloomsbury Information Ltd. Find definitions for ’stock option plan’ and other financial terms with our online QFINANCE Financial Dictionary.

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