Market Valuation and Employee Stock Options
提出基于市场估值的假说，认为员工股票期权可用于出售被高估的股票以增加长期股东价值，并发现期权授予与市场估值和波动性正相关，但极端高估时相关性减弱。
This paper investigates a market-valuation-based hypothesis for employee stock options (ESOs). Given that stock prices do not track fundamental values perfectly, I show that ESOs can be used to sell overvalued stocks and to increase long-term shareholder value. The key cross-sectional prediction of the valuation rationale is that the conditional probability of granting options to employees and the amount of options granted to them are positively correlated with market valuation and volatility. Moreover, for extremely overvalued firms, the correlation between option grant and market valuation is weaker. Firms that use ESOs can save their regular employee compensation costs. I find strong empirical evidence supporting these predictions.