This paper revisits the uncovered interest parity relation. It supplements existing work in two ways: It focuses on long instead of short-term interest rates, and, related to that, employs exchange rate expectations derived from purchasing power parity (PPP) instead of actual outcomes. Among the major floating currencies over the period 1975–1997, the paper cannot support the notion of further increases in UIP-validation beyond that associated with the wave of financial market liberalization and deregulation in the early 1980s.

A repricing occurs when the issuing firm resets the strike price of an employee stock option (ESO). ESO repricings occur most frequently following a significant decline in the underlying stock price. Typically, the strike price is reset to the new stock price. We develop a new model for valuing ESOs with a repricing feature. Our valuation model is developed within a utility-maximizing framework that accounts for potentially multiple repricings, employee risk aversion, employee non-option wealth, the non-tradeability of ESOs, and the early exercise feature of ESOs. Simulations suggest that these factors can significantly affect ESO value.