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Cashless Exercise
(redirected from Cashless Exercises)

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Cashless Exercise
A method of exercising employee stock options in which the employee borrows enough money from a broker to buy the underlying stocks and immediately resells enough shares to pay the loan, in addition to taxes and commissions. This is a form of buying on margin; ordinarily, most brokers would not allow the employee to buy on margin, but, in cashless exercises, they receive repayment almost at once. This results in a profit for both the broker and usually for the employee as well.


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