stock option

noun

1
: an option contract involving stock
2
: a right granted by a corporation to officers or employees as a form of compensation that allows purchase of corporate stock at a fixed price usually within a specified period

Examples of stock option in a Sentence

Recent Examples on the Web
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The industry supports high-paying positions and generates substantial tax revenue through stock options and capital gains when employees sell their shares. Piper Heath, Los Angeles Times, 2 July 2025 The most notable adjustment was for outstanding employee stock options. David Trainer, Forbes.com, 27 June 2025 But more valuable are the long-term incentive bonuses, which are paid in shares of stock and stock options and are based on earnings. Melody Petersen, Los Angeles Times, 18 May 2025 The company has $477 million in total debt, $42 million in outstanding employee stock options, and just $226 million excess cash. David Trainer, Forbes.com, 5 June 2025 See All Example Sentences for stock option

Word History

First Known Use

1877, in the meaning defined at sense 1

Time Traveler
The first known use of stock option was in 1877

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Cite this Entry

“Stock option.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/stock%20option. Accessed 19 Jul. 2025.

Legal Definition

stock option

see option sense 3

More from Merriam-Webster on stock option

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