Originally Posted by
FinancialAccoun
Ok I have a question that I don't understand about stock options.
Why won't everyone do it and become rich?
because if you agree to buy the stock option at some fixed date and when the time comes for emmployees to exercise their options when the current market price is higher they can make money and if not they don't have to excersice their option so isn't this be a win-win situation? because you don'thave to excersice your option.
So from your question, it sounds like you are specifically referring to just employee stock options. In that case, there is no reason not to. Do you know of some employees who aren’t taking advantage of it?
I guess one reason would be people might be waiting.
For example. Your option to buy is at 10 per share. It is trading at 12. You think the price will go up and want to wait. But you don’t want to exercise at 10, because you don’t want to risk losing your own money, or maybe you don’t have the money to exercise at 10.