The reason why people choose #1 is because your grant vests over 4 years but you lock in the price per share at year 0, so you are effectively leveraged for free, and if the stock grows your comp is going to compound nicely, it is entirely possible that by the end of year 4 your annualized comp would be $1M+. It would be hard to replicate that just with cash, because at year 0 you don’t have the entire value of the grant to allocate and lock in the price, so your invested money cannot compound as much.

As for me, I do not invest in FAANG, too risky for me. I prefer to get paid cash higher than FAANG and invest in a diversified portfolio (I’m in VTI/VXUS/BND).

With this strategy I am at $3M at 34, and I have almost enough savings to fire before 40 that I don’t need FAANG returns and volatility, SP500 will take care of me just fine with reduced volatility.