Can women understand stock options?

What a ridiculous question, posed by a misguided article trying to make it simple for the girls.

By Damien Cave
Published August 24, 2000 6:23PM (EDT)

I've never exercised a stock option. To be honest, I still don't know much about the process, much less how details like the alternative minimum tax work. But in all the times that I've confused "a four-year vest" with an L.L. Bean product, no one has ever tied my ignorance to my gender. No one has ever patted me on the head and comforted me by saying, "It's OK, Damien, this stock market thing is confusing to men."

My female colleagues, however, were treated to just such an insult Wednesday on CNBC's "Women's Investment Center" Web site. There, they and anyone else who visited found an article by equities editor Caitlin Mollison, telling them, "Women, in particular, need to be educated about the intricacies of options to avoid common pitfalls."

Women, it seems, are just too dumb to figure out these newfangled benefits packages on their own. Options are just so, like, unfamiliar; they're "new to women," says benefits consultant Ralph B. Nelson in the article. "Therefore, [women] need to take the time to understand options by talking to their human resources people, working out a stock-exercise strategy and doing research." Never mind that practically no one had heard of stock options 10 years ago, and company-sponsored seminars around IPO time that explain the implications of exercising and selling windows are filled with men and women -- who previously didn't have a clue how to handle the new economy's de rigueur compensation packages.

Not only do women need a good teacher, according to Mollison -- preferably a man like Nelson, we presume -- but they also need to get over their nurturing tendencies, we learn. Since women are "more concerned about safety and capital preservation and making sure the money is there for the budget," she scolds, they tend to avoid options and thus greater riches.

So once again it appears that little has changed: Women are still Alices in the wonderland of business, nurturers who are lost but for a good man. Tell that to Meg Whitman, the CEO of auction giant eBay, one of the Web's most successful public companies. Carly Fiorina, CEO of Hewlett-Packard, one of the Dow's 30 bellwether companies, which just enjoyed third quarter earnings up 48 percent from last year's, might also like to know that she doesn't understand corporate finance. And Oprah Winfrey -- the queen of all media, who is capable of altering not just her own employees' fortunes but also those of every major publisher -- you too must be sooooo confused.

How insulting. Of course these women and millions more are just as likely to understand options as their male counterparts. Just ask Nancy Pfund, managing director at Chase H&Q, an investment banking firm. "There's absolutely no reason why women should be disproportionately less capable in terms of options or anything else," she says. "There's not a shred of evidence to suggest that women don't understand these things. It's a misperception."

It's also an insult, one that the writer, a woman apparently financially savvy enough to be the "equities editor," somehow missed.

Damien Cave

Damien Cave is an associate editor at Rolling Stone and a contributing writer at Salon.

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