by Bill Dillhoefer, MBA Determining the right time to exercise one’s employee stock options is the key to maximizing the value of this benefit. Stock options are granted at a fixed exercise price and then must be exercised after vesting and prior to the expiration date to realize their value. During the time between vesting and [...]
Excerpts from the Ayco Compensation & Benefits Digest - April 12, 2013 Long-term incentive (LTI) awards typically account for a significant portion of the compensation received by corporate executives. Within the universe of LTI awards there are four main types: 1) stock options and stock appreciation rights (SARs); 2) restricted stock and restricted stock units (RSUs); 3) performance shares [...]
by Phil DeMuth, Ph.D. An excerpt from The Affluent Investor - Financial Advice to Grow and Protect Your Wealth Today’s corporate executives should spend at least as much care considering how to manage his stock options and restricted stock as he does managing his airline miles. This is a daunting task, because the interwoven tax and [...]
No matter how big or small your advisory firm is, if you want to develop a successful executive services offering it is prudent to start with a pilot project and a documented plan. Here is a list of items that should be included in the plan. Keep in mind that project stakeholders need to be involved in the development of the pilot [...]
The recent article on Restricted Stock Units from the PayScale blog by Dan Walter provides background for stock plan sponsors on this form of equity compensation. It does a good job of describing the three limitations regarding receiving RSUs, but it stops short of providing any guidance for recipients on what to do with them. In summary, here are the downsides [...]
Continue →By Bill Dillhoefer Financial advisors contact me regularly to ask for ideas on how to grow their practices by acquiring corporate executive clients. Having been in the personal equity compensation management space for 13 years I’ve seen what works and what doesn’t. Here are a couple of do’s and don’ts for pursuing this market: Do have a few [...]
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This video shows step by step how to select a reasonable volatility assumption for valuing employee stock options using the Black Scholes calculation. Volatility is a required assumption for calculating the “Time Value” of an option and selecting a value is an art not a science. This is because any volatility assumption that can be justified is appropriate. Specifically, [...]
Continue →Although Incentive Stock Options (ISOs) are not as common as they were a decade ago, we still run into situations where financial advisors have a client or prospect that wants to take advantage of the lower Alternative Minimum Tax (AMT) tax rates on these grants and optimize for tax efficiency. These advisors turn to us for [...]
Continue →Think there’s no point in explaining the time value of employee stock options to employees? Think again! This recorded panel discussion from the 2012 NASPP National Conference presents academic research showing that communicating the time value inherent in options can significantly change how employees view their stock options grants. This presentation also offers strategies for explaining time value and provides a [...]
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Here’s an idea financial advisors can use to entice executives into seeking their professional assistance. It is called the StockOpter Teaser Report because it provides employee stock options recipients with unique information that compels them to reach out for help. This is a standard report templated included with a subscription of StockOpter.com. These reports can be created individually for [...]
Continue →Working with executives with equity compensation is a proven way of securing high net worth clients. However, financial advisory firms who are interested in competing in this market and achieving significant revenue goals need to provide more than just basic financial planning that includes employee stock options and restricted shares. Pursuing the equity compensation market requires planned effort and coordinated resources. Here [...]
Continue →Employees with equity compensation represent a great opportunity for advisors to generate new and ongoing business. This is because the market is largely under served and highly lucrative over time. Of the approximately 10+ million employees who receive equity compensation awards, only a small percentage utilize professional assistance. So when financial advisors cross paths with these prospects it [...]
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This flyer is for individuals with employee stock options to help them understand the things that they really should know and regularly monitor. Click here for a printable PDF version of this document or click on the image for a larger version. If you would like an editable version of this flyer contact Bill Dillhoefer at [email protected]
Continue →By Jennifer Namazi, Editorial Director, NASPP on May 9, 2013. From the NASPP Blog: http://tinyurl.com/crnvaz6 Across my desk this week came the latest report from Equilar, an executive compensation data firm, on equity trends. In their 2013 Equity Trends Report, key findings included upticks in the use of restricted stock and performance shares, and a [...]
Continue →Industry information and ideas to help financial advisors grow their practices by engaging individuals with equity compensation, managing their holdings and helping them to make prudent diversification decisions regarding their employee stock options and company shares. 40 Hot Corporate Prospects: In their March 2013 Equity Compensation Report, the NCEO (National Center for Employee Ownership) identified 40 of the 900 largest [...]
Continue →Results of a new survey reflect how improving economic conditions and a strengthening job market are prompting many U.S. companies to enhance their employee stock purchase plans in an effort to improve their benefits package. According to Fidelity Investments, more than half of the companies surveyed (51%) indicated they intend to modify their employee stock [...]
Continue →In their March 2013 Equity Compensation Report, the NCEO (National Center for Employee Ownership) identified 40 of the 900 largest public companies in the United States that provide broad-based stock options to employees. These companies include Apple, Cisco, Deere, Merck and Southwest Airlines. Click the following link for the names of all 40 companies. NCEO List [...]
Continue →This news brief contains ideas to help financial advisors grow their practices by engaging individuals with equity compensation and managing their holdings. Some Do’s and Don’ts for Engaging Corporate Executives: Financial advisors contact us regularly to ask for ideas on how to engage and acquire additional executive clients. Having been in the personal equity compensation management space for 13 [...]
Continue →This is a basic overview of Employee Stock Options written for ESO newbies, but it’ a fairly fresh perspective on a well-worn topic…… An Introduction To Employee Stock Options By Tara Struyk | Published March 11th, 2013 on Dividend.com.
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By: Bill Summers, CPA, CFP®, MST Introduction: When using StockOpter.com the question often arises as to whether the dividend yield should be used to calculate the Black-Scholes and time value. This question is often asked with regard to the Insight Ratio® (time value divided by Black-Scholes value). This paper explores the ramifications of using the [...]
Continue →This news brief contains information to help financial advisors assist individuals with employee stock options and restricted shares by facilitating timely and prudent diversification decisions. ISO Planning Guidelines: If you have clients with Incentive Stock Options (ISOs) that have low Insight Ratios, be aware that it is prudent to exercise and hold them early in the year. This [...]
Continue →From the myStockOptions Blog While the American Taxpayer Relief Act (ATRA) did not end the alternative minimum tax (AMT), it has three provisions with a major impact on the AMT calculation. These are important for high-income taxpayers—particularly those who exercise incentive stock options. ATRA set the AMT income (AMTI) exemption amounts for 2012 at $50,600 for [...]
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