RT Journal Article SR Electronic T1 Stock-Based Compensation JF The Journal of Wealth Management FD Institutional Investor Journals SP 55 OP 57 DO 10.3905/jwm.2001.320402 VO 4 IS 1 A1 Heidi L. Schneider A1 John F. Geer, Jr. YR 2001 UL https://pm-research.com/content/4/1/55.abstract AB Observing that stock options have become a key element of compensation for many employees, as stock option plans have gone from covering about one million employees in 1990 to more than seven million today, the authors investigate some of the key planning issues associated with employee stock options. They use recent market data to explain the risks associated with market and company-specific risks and to discuss five questions which option holders should ask when considering the question of the appropriate level of diversification. The authors then turn to the vexing tax questions associated with the problem—illustrating with recent ‘horror stories’ the need to plan carefully— and also consider important estate planning issues which options also raise. They conclude that the planning process is made much more complicated by stock option-based compensation, and that potential rewards—and potential risks—of stock options make it critical that both client and financial planner understand all the choices that they create.