Keep schedule, price and probability separate
A tranche is one group of units attached to a vesting point. Units describe the entered award schedule, price creates a scenario value for that tranche, and vesting probability applies an explicit uncertainty adjustment.
Changing a later tranche’s probability is not the same as changing its share price. Keeping those inputs separate makes it possible to see whether vesting assumptions or price assumptions drive the result.
Calculate each tranche before adding the totals
Scheduled tranche value = entered units × entered price. Probability-weighted tranche value = scheduled tranche value × entered vesting probability. Total scheduled and weighted values are the sums across all four tranches.
Expected units apply the probability to units before summing. The risk gap is scheduled value minus weighted value; it is not a prediction of loss.
Worked example: four vesting scenarios
| Tranche choice | Entered scenario | How it changes the comparison |
|---|---|---|
| Year 1 | 250 × 20 × 100% | All entered units are included in the weighted scenario, giving this tranche no probability gap. |
| Year 2 | 250 × 22 × 90% | The higher price raises scheduled value while the 90% probability reduces the weighted view. |
| Year 3 | 250 × 24 × 80% | A lower probability gives this later tranche a wider gap despite its higher entered price. |
| Year 4 | 250 × 26 × 70% | This tranche has the highest entered price and lowest entered probability, so both assumptions matter. |
| Portfolio totals | 1,000 units; 23,000 scheduled; 850 expected units; 19,300 weighted; 3,700 gap | Compare scheduled and weighted views together instead of presenting either one as certain proceeds. |
Do not treat RSUs like options or formal accounting value
This RSU scenario has no exercise price: entered units create value when paired with an entered share price. An option scenario instead depends on the spread above a strike price and can be underwater.
Formal share-based-payment accounting considers award terms and vesting conditions beyond this personal scenario. The calculator excludes tax, liquidity, dividends, employer outcomes and vesting certainty; it does not calculate fair value.
How the RSU Vesting Value Calculator calculation works
totalProbabilityWeightedValue = Σ trancheUnits × trancheSharePrice × trancheProbability
- totalProbabilityWeightedValue
- Probability-weighted RSU value
The calculator and article use this relationship consistently; the article does not reimplement the calculation.
totalScheduledValue = Σ trancheUnits × trancheSharePrice
- totalScheduledValue
- Scheduled RSU value
The calculator and article use this relationship consistently; the article does not reimplement the calculation.
totalExpectedVestedUnits = Σ trancheUnits × trancheProbability
- totalExpectedVestedUnits
- Expected vested units
The calculator and article use this relationship consistently; the article does not reimplement the calculation.
totalRiskAdjustmentGap = totalScheduledValue − totalProbabilityWeightedValue
- totalRiskAdjustmentGap
- Risk-adjustment gap
- totalScheduledValue
- Scheduled RSU value
- totalProbabilityWeightedValue
- Probability-weighted RSU value
The calculator and article use this relationship consistently; the article does not reimplement the calculation.
Value four 250-unit annual tranches at entered prices and declining vesting probabilities.
Inputs used in the RSU Vesting Value Calculator worked example
| Input | Entered value | What it represents | Source class |
|---|---|---|---|
| Tranche 1 vesting year | 1 years from now | Whole-year offset for this vesting tranche. | user assumption |
| Tranche 1 units | 250 units | RSU units assigned to this tranche. | user assumption |
| Tranche 1 projected share price | 20 currency units/share | Your assumed share price when this tranche vests. | user assumption |
| Tranche 1 vesting probability | 1 decimal | Your probability of this tranche vesting, as a decimal. | user assumption |
| Tranche 2 vesting year | 2 years from now | Whole-year offset for this vesting tranche. | user assumption |
| Tranche 2 units | 250 units | RSU units assigned to this tranche. | user assumption |
| Tranche 2 projected share price | 22 currency units/share | Your assumed share price when this tranche vests. | user assumption |
| Tranche 2 vesting probability | 0.9 decimal | Your probability of this tranche vesting, as a decimal. | user assumption |
| Tranche 3 vesting year | 3 years from now | Whole-year offset for this vesting tranche. | user assumption |
| Tranche 3 units | 250 units | RSU units assigned to this tranche. | user assumption |
| Tranche 3 projected share price | 24 currency units/share | Your assumed share price when this tranche vests. | user assumption |
| Tranche 3 vesting probability | 0.8 decimal | Your probability of this tranche vesting, as a decimal. | user assumption |
| Tranche 4 vesting year | 4 years from now | Whole-year offset for this vesting tranche. | user assumption |
| Tranche 4 units | 250 units | RSU units assigned to this tranche. | user assumption |
| Tranche 4 projected share price | 26 currency units/share | Your assumed share price when this tranche vests. | user assumption |
| Tranche 4 vesting probability | 0.7 decimal | Your probability of this tranche vesting, as a decimal. | user assumption |
Worked example: RSU Vesting Value Calculator
The calculator normalizes the inputs above, applies Probability-weighted value, and returns the outputs below. The displayed result is therefore reproducible in the linked calculator.
| Measure | Result | Interpretation |
|---|---|---|
| Probability-weighted RSU value | 19,300 currency units | Sum of each tranche’s units, assumed price and vesting probability. |
| Scheduled RSU value | 23,000 currency units | Sum of units multiplied by assumed share price before probability adjustment. |
| Expected vested units | 850 units | Sum of tranche units multiplied by vesting probability. |
| Risk-adjustment gap | 3,700 currency units | Scheduled value less probability-weighted value. |
Interpret the result and test Tranche 1 projected share price
- Probability-weighted RSU value: 19,300 currency units. Sum of each tranche’s units, assumed price and vesting probability.
- Scheduled RSU value: 23,000 currency units. Sum of units multiplied by assumed share price before probability adjustment.
- Expected vested units: 850 units. Sum of tranche units multiplied by vesting probability.
- Risk-adjustment gap: 3,700 currency units. Scheduled value less probability-weighted value.
| Result | Baseline | Changed-input scenario | How to read it |
|---|---|---|---|
| Probability-weighted RSU value | 19,300 currency units | 19,800 currency units | Sum of each tranche’s units, assumed price and vesting probability. |
| Scheduled RSU value | 23,000 currency units | 23,500 currency units | Sum of units multiplied by assumed share price before probability adjustment. |
| Expected vested units | 850 units | 850 units | Sum of tranche units multiplied by vesting probability. |
| Risk-adjustment gap | 3,700 currency units | 3,700 currency units | Scheduled value less probability-weighted value. |
Checks that are specific to RSU Vesting Value Calculator
- Exactly four explicit tranches are evaluated.
- Each vesting year is a whole number from 1 to 20.
- Each probability stays between 0 and 1.
What this RSU Vesting Value Calculator guide includes and excludes
- Share prices and vesting probabilities are user assumptions.
- Each tranche is valued independently.
- All four entered tranches remain in the scenario URL and saved state.
Sources and method boundary
- RSU Vesting Value Calculator methodology — Wage101 (accessed 2026-07-27): Canonical formulas, units, validation, calculator behavior and limitations.