Equity-options

This book was great! A headhunter caught me off gaurd with a great opportunity, but I had to make a decision faster than I was comfortable with. I got myself smart in about 2 days, and was able to negotiate a much better compensation package. I'd recommend it to anyone in a negotiation-situation.

Stock options have always been a big mystery to me. This book helped me understand what employers are talking about with stock options. I found tons of "insider" tips and real-life examples that I will put to use right away. In particular, I found the "secrets" of negotiating for stock options-- especially the tricks companies use to reduce stock options grants--to be especially eye-opening. I also learned how to think of myself as an investor and not just an employee--something I had never done before.

I've been able to adjust my own opportunites to negotiate for options. In addition, I found the book fun to read. The writing is fresh, clear, and the concepts easy to understand, even for a novice like me. I also found the glossary of terms and Internet resources to be very helpful tools. I highly recommend this book for job seekers and those who really want to know how to negotiate for all they're worth.

For a graduate student in finance with an interest in derivatives, this is an excellent introduction to
* structural credit risk models (starting from Merton 1974, guiding the reader to very recent models)
* change of numeraire techniques
* the extension of structural credit models for option valuation.

Although - at first sight - it seems to be very technical, this is definitely the most accessible book in this area I have ever seen!

In his book, Mr. Ira Kawaller covers an amazing range of topics from risk managemant to stock options. I have never read a book so incredibly exciting in all of my life. Mr. Kawaller knows how to display the facts, provide informative facts, and decorate it all with a wit and charm that thrives in his book. "Financial Futures and Options" is THE book for risk management lovers everywhere. This book inspired me to change my career choices. After reading "Futures" (in one sitting!) I knew that prostitution and drug dealing was just not for me. I am now an economist making over $600,000 a year and loving it. Thank you, Mr. Kawaller. You turned my life around. (From what everyone is saying, I believe Mr. Kawaller now runs his own business called Kawaller & Company in Brooklyn, NY. If you ever need help financially, Mr. Kawaller will personally see to it that you get back on track. After all, risk can be managed if it is faced in a disciplined way. Ignore it and you face disaster. E-mail Kawaller and Company at kawaller@idt.net and good luck!)

This book is good in that it covers all the basic mechanics of stock options -- Incentive and Non-Qualified, and ESPP plans. However, this basic information can easily be found on the web or from your employer.

What is sadly lacking from this book is advice on strategy on how to manage options, e.g., ideas on when to exercise and sell. Because of this, the book is quite disappointing to me and not very useful.

Reading this book may not provide you with all the answers, but it will help you ask all the right questions of your CPA.

A few hours spent reading this title will give you a solid understanding of the fundamentals of options: stock, options, grants, exercise, strike price, employee stock purchase plans, AMT, and so on. More importantly, it will give you a good understanding of the complex tax issues that options may expose you to. And most importantly, it will make very clear the questions you need to ask in interviewing a prospective accountant, and in working with an accountant or financial planner.

The average reader is not likely to garner enough information to fully plan their option liquidation by themselves (multiyear strategies for minimizing AMT, for example, are beyond the scope of this book), but at least you'll know what sorts of things your accountant should be working out for you.

I bought this book after checking out the reviews on Bob Pastorie's book on Stock Options and after visiting the author's web site. I wanted a thorough understanding of stock awards, stock options, and option strategies.

I'm glad I bought this book. It's packed with facts and how to-do-it information that takes the mystery out of stock options and pre-IPO stock.

This is a complicated subject and the book does justice to everything. I especially liked the first couple of chapters that reviews the basics of taxes and terminology before launching into stock awards and stock options. Despite plenty of examples and clearly written material, this is not a book that you'll read once, and retain everything. The IRS has made sure of that. I will have it close by to refer to. Besides the book, the author's web site is very helpful. He promptly responded to my specific questions. Wish I could say that about others!

There's a great potential to make some serious and costly mistakes when it comes to stock options. Yes, you'll need help from lawyers and tax professionals, but without this book, you won't understand anything they're talking about. In fact, I think you'll spend more than the cost of the book in legal and professional fees if time has to be taken out to educate you about the basics.

I read the book at light speed the first time around. I initially thought that things were confusing and unorganized. I realized that this was a mistake on my part. The subject matter is complex, especially on the various kinds of options and when they vest.

I read the book a second time to get prepared to see my lawyer, tax, and estate planner. The book gave me the knowledge to fashion some specific strategies on my stock grant and also how to exercise my options. The benefits of the book's organization have now become more obvious to me. Is there a negative aspect of the book? Sure. It didn't get into estate planning or suggest ways of sheltering the potential wealth that could accrue from stock and options from firms going to an IPO. I also wish it would have talked more from the perspective of a firm getting ready to do an IPO, although there were some examples of this. I was also only interested in Nonqualified Options and not the exhaustive coverage on Incentive Stock Options that employees usually receive. However, this was no reason to give it less than 5 stars. I think the estate planning aspect is a great subject for Mr. Thomas' next book or something that the web can handle.

Bottom line here: the book is well worth the price and your time. Read it once, twice, and keep it handy. You'll definitely refer to it today and in the years ahead.

Now in an fully updated third edition, The Entrepreneur's Guide To Equity Compensation from the Foundation for Enterprise Development provides an excellent and highly recommended introduction to the hows, whys, and wherefores of employee ownership, as well as how empowered employees can help build a cutting-edge, proactive organization. Individual chapters address both individual-based and company-wide stock plans, savings plans that can hold employer stocks, crucial issues that can interfere with success, and much, much more. A recommended primer for any employer, for The Entrepreneur's Guide To Equity Compensation costs far less than what an unwise stock options decision would impose upon a corporate bottom line!

This excellent and clear explanation of approaches to equity plans, provides a guide to creating an employee ownership strategy. The book covers: stock grants; direct stock purchase programs; stock option plans; qualified employee stock purchase programs (ESPPs); employee stock ownership programs (ESOPs); 401(k) and other qualified retirement plans; nonqualified deferred compensation plans; stock appreciation rights and phantom plans; stock programs for American companies operating abroad; and the most suitable equity arrangement for various types of legal forms of companies. Explains the concept, pros and cons, and tax and cost implications. Viewing this work as a compensation consultant, I find it to be an outstanding reference, providing highly accessible explanations. Very highly recommended.

I have used the Entrepreneur's Guide for several years. It is an excellent tool - comprehensive yet easy to understand and logically organized. It presents a very complex area in a clear fashion that goes a long way to helping the interested person decide on a general approach to equity compensation that will fit their needs and help reach their goals for a very reasonable cost. I recommend it to anyone considering exploring an equity compensation strategy of any kind.

This is definitely a very useful book for students taking financial engineering courses or complete newcomers in the aera of structuring. The book's written in a very clear and approachable manner and the author doesn't bother you with obscur mathematics. However, being myself a structurer of derivative products, I must unfortunately say that this book didn't really improve my knowledge in the field of structuring. But since I believe that Dr. Kat's main objective was to primarily target newcomers in the area of structured products, and not any professionals working in the business, I still think that the book is a respectable achievement.

I don't know what the occupation of the reader from Seattle is (Anonymous?), but for students of finance, like myself, who are looking for an easy understanding of how the derivatives industry works and what are the more common products traded on it, beginning with the less complex like calls, puts, followed by more complex derivatives structures and how to hedge the exposure of each of those products with out the use of complex maths, the Structured Equity Derivatives is a well written book that has help me to understand much better the world of the derivatives industry. Actually it has help me much more than other books talking about the same subject but in a different way.

I had to read this book as a requirement for a postgraduate level finance course which I took this year. I found it extremely insightful and easy to understand.

I believe (keeping fingers crossed!) that there are a lot of highly technical books out there for those with several years of experience in structured derivatives and the so called rocket scientists. But what about those who don't fall under this category? Where should those new to this field ( structured derivatives) or students who want to grasp a better understanding of derivatives after reading books such a Hull's , start with? This is exactly where Dr. Kat's book comes to picture, with a claim to offer an through understanding of structured derivatives, nothing more or less.

Reading criticism such as the one from "reader from Seattle" (below) is surprising to me, specially when he says: "I bought this book with high hopes, but I found little knowledge in it that I couldn't get from my own colleagues. And now, where is the value of reading a long book if all your colleagues know it from the word go?" Well, let me tell you something, it's for those who are not surrounded by "colleagues who know it from the word go"! And, there are a lot of us out there.

I bought it with little hopes as a text book for my course, but I found insightful knowledge of derivatives in it, which I couldn't get from a lot of my teachers let alone my colleagues!

I highly recommend it to all those who have had an introductory course on derivatives covering books such as Hull's, and want to progress further.

Suggestion: Check your colleagues first, if they know the subject, drop the book!! : )

This is probably the worst written book I have ever read. The author obviously understands the topic but it is one thing to know a subject and another thing to teach it. I am a physician and I have read my share of books.

This book, published in 1993, is now a classic and the definitive guide to trading LEAPS. It provides an excellent introduction to LEAPS and takes the pain to explain how LEAPS differ from traditional options. If you already have knowledge of options, this book will be a breeze to you, thanks to the author's lucid and humorous writing style. Do keep in mind that LEAPS are more than just longer-term options; pricing them using BS, for example, would be quite wrong.

Which brings us to the drawback of this book from the early 90s. Much as changed to LEAPS -- the demand, the valuation methods, the trading mechanics -- since 1993, and this book would have remained great had it been updated. As it stands, you should definitely use it in conjunction with the web to make sure you get the latest info on these securities.

One last thing: if you are set on trading LEAPS, make sure your broker can accommodate it. My online broker is great for trading options, but it turns out they won't allow LEAPS for accounts less than $50k, which include mine.

In short, I recommend this book highly as a primer to LEAPS. Read it from cover to cover and make sure you duly understand all the RISKS involved, not just the potential gains. Good luck!

LEAPS is a helpful manual and it can be followed by readers who have basic knowledge on options. Roth analyzes in a very vivid and enjoyable way LEAPS and offers to the investor all the necessary background. I really enjoyed reading it.

The book is of very limited value for any company outside the US. All explanations are given with regard to US laws and regulations.

This book is an invaluable reference for any business owner or advisor contemplating the use of stock options to improve a company's performance, motivate employees and create an ownership culture. The National Center for Employee Ownership, the impetus behind this book, is a national treasure, as far as I'm concerned. Their mandate is to democratize the workplace to best reflect the demands and dynamics of the 21st Century Global Economy. This book uniquely addresses everything a company needs to consider regarding stock options: the business, financial, accounting, legal, securities and human resources/organizational development aspects. You cannot find a better resource or more accessible book in the stock options arena.

Excellent book. Though the title doesn't sound as hot as "Ectrepreneu's guide to equity", it covers much more and in depth with the same price. It covers all the pros and cons and tax issues for stock option and empolyee stock ownership plan and other incentive plans. The bottom line, after reading the book, you won't be any more confused about each plan. To an employee, it is very helpful in deciding if you want to stay with present employer or change to another one with a better incentive plan. To an entreprenur, this is the Bible. It will benefit your business and your staff enoumously. I wish I had bought this book first. It could have saved me time and money in shipping $ handling fees and returing back to Amazon the "Entrepreneu's Guide to Equity"

Overall, I found this book interesting. There is nothing really new or unknown to quants or researchers working in this field but much of the material has actually not been written down in any other book, which makes this book useful.

There are some important points about hedging and pricing derivatives in a non Black Scholes world which are important but are nowhere to be seen in any textbook on options and/or mathematical finance. The author correctly stresses the distinction between real-world and implied statistical quantities.

Also, he gives a lot of common sense comments on questions like hedging with smiles, which are very helpful. Topics like changes of numeraire which are exposed in notoriously obscure ways in many mathematical finance textbooks are explained in simple terms with EXAMPLES. Examples illustrate eveyr point and this is perhaps what is lacking in other textbooks. I appreciated this a lot. Mathematical rigor is not the strong point of this book but I think it is an advantage rather than a drawback: it allows the reader to focus on important points which are not the mathematical ones in fact. However, there are some mistakes in the text from time to time.

However, there is something I feel very unconfortable with: the author does not mention/cite other peoples work in this field and seems to attribute to himself most of the results explained in the book. Anybody who has been working in the field in the last decade can easily associate lots of names with each of the points raised in the book but these names are nowhere to be seen. Does the author have a very limited view of the literature or is he deliberately not mentioning other peoples work? Perhaps a mixture of both.

This book brings together many of the recent publications concerning the volatility surface. The work is interesting and points out many of the well known problems with pricing options in a non Black Scholes world. As is often the case with financial literature, it is more interesting from an academic perspective than from a practical one.

The Black-Scholes model for pricing FX and equity options has become ubiquitous. However, it is always used with a pinch of salt. In particular, traders typically use different volatilities when pricing options with different strikes, a practice which makes no sense in the context of the model, but is a very effective way of compensating for its deficiencies. This is known as the smile effect from the shape of the volatility graph.

Rebonato's new book sets out to examine these deficiencies and presents various alternative models. For each model, he examines the validity of its assumptions and predictions, convincingly demonstrating that fear of jumps is a major cause of smiles.

The other major theme of the book is that volatility and correlation are quite different objects for interest rate derivatives than for FX and equity options. In the context of BGM models, he shows that the shape of the volatility function of forward rates is the major cause of decorrelation, rather than actual instantaneously uncorrelated movements.

This book is not a first book on mathematical finance but it is accessible and is a must read for anyone involved in the pricing of derivative products.

This book surprised me because it was much better than I expected. It presents a very readable--the most readable I've seen--summary of the mechanics and strategies of option trading. Moreover, the book covers topics I've never seen covered before in a book on options, such as the benefits of using information from established sources on the Internet; and cites several academic studies without slipping into the stale writing style associated with academe. Still, there is reason for a reader to be skeptical of the effectiveness of the strategies discussed in the book. The reason for this is the long-term performance record of the author's newsletter, which like the book is entitled "The Option Advi$or." According to Mark Hulbert's ratings, which have been regarded in some circles as the most accurate standards for measuring the quality of investment newsletters, this newsletter's long-term record ranks near the bottom of all letters covered. Only Joseph Granville's "Market Letter," as far as I remember, has a worse ten-year record. That said, one has to wonder whether the strategies discussed in the book are going to be effective in the future. On one hand, past performance does not necessarily portend future results. On the other, however, Schaeffer's picks in the past, assuming they've been chosen according to the strategies discussed in the book, have been less than outstanding in the past. Careful readers should remember that if they want to use this book more than as a decent general reference guide.

Only 50% of the book is about options. The other 50% concentrates on how to use technical analysis to find winning stocks. It is probably the best book for the beginner and intermediate trader. With the Technical analysis, it can be used for both stocks and options. It belongs on every trader's shelf. The reason it didn't get a "5 Star" is that he really doesn't go into closing a position if the trade is going the wrong way. I pretty much had to learn that on my own. I have read it cover-to-cover 3 times and certain chapters at least 6 times.

I find it funny how many negative things I have been reading here and I have a few comments. First, this book is GREAT? In 4 months I made thousands of dollars by following Bernie's strategies. Second, he actually TEACHES how to do something with your money that isn't confusing, unlike many other money making strategy books. Third, he STRESSES over and over that you MUST CUT YOUR LOSSES when they hit 8% and let your winners run to overcome the deficit.
I wonder how many of these negative people that have posted angry messages here were too emotional and let their greed or fear get the better of them while making investment decisions attempting to follow Bernie's advice? I learned a long time ago that being negative and only talking about the problem and not a SOLUTION to the problem is NOT the way to live life.
Please read this book, and FOLLOW HIS RULES. It does actually work. And don't listen to Forbes, for crying out loud they have to hate anyone else that might actually compete with them and make them look bad. How many of you have made a dime off of what Forbes magazine taught you? I haven't. Read this book...it works, but ONLY if you work and FOLLOW THE RULES!