A restricted stock unit is a compensation issued by an employer to an employee in the form of company stock.
 | | Restricted Stock Unit - RSU | | A restricted stock unit (RSU) is a compensation issued by an employer to an employee in the form of company stock. Restricted stock units are issued to an employee through a vesting plan and distribution schedule after achieving required performance milestones or upon remaining with their employer for a particular length of time. RSUs give an employee interest in company stock but have no tangible value until vesting is complete. The restricted stock units are assigned a fair market value when they vest. Upon vesting, they are considered income, and a portion of the shares is withheld to pay income taxes. The employee receives the remaining shares and can sell them at his or her discretion. | | Breaking it Down: | | Suppose Madeline receives a job offer. Because the company thinks Madeline's skill set is valuable and hopes... | | Read More » | | Related to "Restricted Stock Unit - RSU" | | | | Vesting | | Vesting is a legal term that means to give or earn a right to a present or future payment, asset or benefit. | | Read More » | | | Restricted Stock | | Restricted stock refers to insider holdings that are under some kind of sales restriction, and must be traded in compliance with special SEC regulations. | | Read More » | | | Equity Compensation | | Equity compensation is non-cash pay that is offered to employees, including options, restricted stock and performance shares. | | Read More » | | | Employee Stock Option - ESO | | An employee stock option offers specified employees the right to buy a certain amount of company shares at a predetermined price for a specific period. | | Read More » | | |  | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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