The problem is that I may have to buy and hold. For example, if I leave the company, I have to buy the options within 6 months or else they expire.
Otherwise, of course, waiting until the options are profitable is the best move and is risk-free.
1 karma · joined July 11, 2019
Otherwise, of course, waiting until the options are profitable is the best move and is risk-free.
If I choose to do so, then I will have no risk of a loss, because like you said, if the option is underwater, then I will simply not exercise.
The only reason I may end up having to take risk is due to limits on exercise windows. For example, I have to exercise any vested option within 6 months of leaving the company. In that case, I may want to buy the stock, and hold onto it if I expect it to appreciate. Then I will be taking risk, effectively like buying any other stock that may depreciate.