Frequently Asked Questions (FAQ)

This FAQ provides another way to find the information you want. Clicking on a question will take you to the place in the site where your answer is. Use the "Back" button on your browser to come back here.

The questions are broken into two broad categories:

Questions about options and

Questions about what you should do with your options

Questions about options

Options in General

1. What are employee stock options?
2. How do options work?
3. What are Incentive Stock Options or ISOs?
4. What are Non-qualified Stock Options (NQSOs or NSOs)?
5. What is vesting?
6. How long do I have to exercise my options?
7. How do I actually exercise my options?

Income Taxes

1. I have NQSOs, how will they be taxed?
2. I have ISOs, how will they be taxed?
3. What is AMT?
4. What is "capital gain?"
5. What is a "tax bracket?"
6. What are my options worth after taxes?

Leverage and Stock Options

1. What is "leverage?"
2. Why is leverage important to me?
3. What's stock option leverage? How does it work?
4. How does leverage increase returns (and risk)?
5. How do I calculate the leverage in my options?

The Risks of Owning Employee Stock Options

1. What kinds of risk do options have?
2. What are the investment risks of my options?
3. How do you measure risk?
4. How can you manage or reduce risk?
5. Can I reduce the risk of my options without giving up their wealth creating power?
6. What is "personal risk" and why is it important?
7. I didn't pay anything for my options, so how can you say that I have anything at risk?

Critical Capital™ and Employee Stock Options

1. What is Critical Capital™?
2. How do you calculate Critical Capital™?
3. How can Critical Capital™ help me make the most of my options?

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Questions about what you should do with your options

1. How can I maximize the value of my options?
2. If I don't know whether the stock price is going to go up or down, how can I know when to exercise my options?
3. What are the "Five Steps to a Successfuly Exercise Strategy?"
4. I'm just getting started, what should I do with my options?
5. How can I use my options to achieve Critical Capital™?
6. I think my options are worth enough that I could retire or quit working, how can I know whether or not I have enough?
7. With my options, I have Critical Capital™, what should I do to protect it?
8. I've got more than I'll ever spend, how can I use my options to help others?

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