# LABJ Stock Index: October 19

> Private company compensation types explained by J.P. Morgan.
- Title: LABJ Stock Index: October 19 · Los Angeles Business Journal
- Summary: Private company compensation types explained by J.P. Morgan. Private company employees learn about four key equity compensation types before an IPO.
- Keywords: jpmorgan, private bank, equity compensation, ipo, nqso, iso, rsu, psu, business, local, LABJ, Stock
- Source: Los Angeles Business Journal — https://labusinessjournal.com/branded-content/stock-index/labj-stock-index-october-19
- Author: Demi Ajayi
- Published: 2026-10-19T07:00:55+00:00
- Read time: 1 min
- Topics: jpmorgan, private bank, equity compensation, ipo, nqso, iso, rsu, psu, business, local
## What are equity compensation types?
Private companies often use equity compensation for employees before going public.
## Non-qualified stock options (NQSOs)
NQSOs let employees buy shares at a fixed price when the stock price rises above that price.
## Incentive stock options (ISOs)
ISOs do not create ordinary income at exercise but may be taxed as long-term capital gains later.
## Restricted stock units (RSUs)
RSUs are shares promised to employees after a set time or liquidity event like an IPO.
## Performance stock units (PSUs)
PSUs require both time and company performance metrics to vest before an IPO.
## Key takeaway

Private company employees learn about four key equity compensation types before an IPO.