Investing: Pocket Pickers

New rules will mean fewer stock options--and possibly flatter returns

The battle raging over stock-option accounting is enough to put most folks to sleep. Yet 14 million workers in broad-based stock-option plans have a direct financial stake in this skirmish--as do, it turns out, many folks who invest in common stocks. Recent studies have concluded that companies with widely dispersed options outperform companies that grant options only at the executive level. This adds a layer of drama to the latest efforts to require that options grants be treated as an expense that reduces reported profits. No one expects fat-cat execs to take a big hit on their own overall pay. To...

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