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Still, there can be surprisingly large differences in ending valuations depending on the method used and the assumptions in place, especially the volatility assumptions. Or, perhaps you're saving for retirement or financial independence and investing is stocks is part of how you plan to get there. With this benefit erased, another fundamental investing metric will be shifting for many companies. So, while the practice of not recording any costs for stock options began long ago, the number being handed out was so small that a lot of people ignored it. Also, from the company's point of view, would the value of equity offered be tied directly to the perceived difference between the salary offered and the prevailing market rate? Because stock options do stimulate risk seeking behavior, as we know from academic research. Businesses receive three primary valuable benefits. Leave the company before then, and you'll likely forfeit any unvested options. Options awards became more and more attractive and lucrative because the loophole was just too big and tempting to ignore.



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