Restricted Stock Unit (RSU)

A promise of company shares that vest over time.

RSUs are grants of company shares delivered to employees as they vest, with no purchase price required. Unlike options, they retain value even if the stock falls, making them popular at established firms. They are taxed as income when they vest.

Unlike options, a Restricted Stock Unit (RSU) keeps value even when the stock dips, vesting into real shares each year.