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Should I Exercise My 'In-The-Money' Stock Options?

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When your employee stock options become 'in-the-money', where the current price is greater than the strike price, you can choose from one of three basic sell strategies: Exercise your options, then hold the stock for sale at a later date (exercise and hold); hold your options and exercise them later (defer exercise); or exercise your options and immediately sell the stock (exercise and sell). This calculator will help you decide which choice will likely maximize your after-tax profits.

Stock Option Assumptions	Input
Years until option expiration date: (0-20)	(0-20)
Total number of options	(0-999999)
Current price: (per share)	(0-9999)$
Strike (grant) price: (per share)	(0-9999)$
Anticipated annual return on stock: (%)	(-50-50)%
Annual dividends: (per share)	(0-9999)$

Taxation And Investment Assumptions	Input
Anticipated annual return on alternative investment: (%)	(-50-50)%
Marginal tax bracket: (%)	(0-50)%
Long-term capital gains tax rate: (%)	(0-50)%

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Stock Option Assumptions	Input
Years until option expiration date: (0-20)
Total number of options
Current price: (per share)
Strike (grant) price: (per share)
Anticipated annual return on stock: (%)
Annual dividends: (per share)

Taxation And Investment Assumptions	Input
Anticipated annual return on alternative investment: (%)
Marginal tax bracket: (%)
Long-term capital gains tax rate: (%)

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{ "fields" : { "udata" : [ "exDate" , "totalShares" , "currentPrice" , "strikePrice" , "expectedReturn" , "dividends" , "alternativeReturn" , "taxBracket" , "capgainsRate" ] } }

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This calculator is provided by Financial Calculators, Inc., and is intended solely for general information and educational purposes. You should not take any action on the basis of the information provided through this calculator. Please see the disclaimer for further information and limitations.

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