Phantom Stock Plan

Dictionary Says

Definition of 'Phantom Stock Plan'


An employee benefit plan that gives selected employees (senior management) many of the benefits of stock ownership without actually giving them any company stock. Sometimes referred to as "shadow stock."

Investopedia Says

Investopedia explains 'Phantom Stock Plan'


Rather than getting physical stock, the employee receives "pretend" stock. Even though it's not real, the phantom stock follows the price movement of the company's actual stock, paying out any resulting profits.

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