[voldron]

Stock options state that you may exercise, essentially invoke, your right to buy a stock at a given price, also known as a strike price. If you have 100 options at a strike price of $20, you have the right to buy 100 shares at $20 per share regardless of current market value of the stock. Your options also may be subject to a vesting period. This means that after a given time you are given a certain amount or percentage of options you may use. For instance if your 100 options vest over 4 years, you would have 25 options per year that you are allowed to exercise. Vesting periods can be different so ask your employer.

Here is an example:

You are given a strike price of $20 per share and decided to exercise your option. The stock is currently at $30 per share. You are now buying the stock at $20 per share. You now decide to immediately sell those shares and now make $10 per share gross profit.

All stock purchases and sale must be done through a broker.

Hope this helps.

[Moral_]

>If you have 100 options at a strike price of $20, you have the right to buy 100 shares at $20 per share regardless of current market value of the stock

Not exactly. Maybe this isn't the same thing as an employer stock option. But a single call option, what I think you're referring to, gives you the right to buy 100 shares at x strike price. So 100 call options would be 10,000 shares at x price.

[voldron]

That is true for call and put options but employee stock options are not the same thing. A call or put option as you stated is for 100 shares per option contract. An employee stock option is the right to buy N number of shares at a strike price, not in blocks of 100 per contract.

[Moral_]

Thanks for the clarification!