Re: Stock option

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Posted by Mark on May 01, 2007 at 11:40:20:

In Reply to: Re: Stock option posted by Cuti on April 30, 2007 at 23:26:58:

: Assume I work for Google, they gave me 1000 vested over four year at the price $100. How can I record that option?
: Cuti

Hi Cuti,

You can track this with a combination of 2 investments. One investment would be in Google to track your vested shares. For example, you might record a buy of 250 each of 4 years, as they vest. The second investment would be a negative valued cash account, for the grant amount. So, if your option price is $100, when you vest in the first 250 shares, you would record a buy of 250 shares in Google, and a sell of $25,000 (250 * 100) in the cash account. The combination of these 2 investments will track your overall holdings. This only works if the options are "above water". If the stock price is below the option price, do not record either the purchase or the sell of cash.

Thanks,
Mark
--
Fund Manager - Portfolio Management Software

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