Stock Options: Exercise or wait?

dgerrard

Hi all.  Apologies, know my question is very similar to https://forums.moneysavingexpert.com/discussion/6201756/stocks-and-stock-options-advice, but I'm still not understanding what to do.  Need explaining like I'm 5 (or younger).

So:

I've got 7000 options.  One batch of 2000, fully vested (expires in 2027).  5000, to fully vest in Nov 1, 2024 (expires in 2031).

There are general rumours that our stock price will be going up quite significantly in the next 6-12 months due to certain factors.

I have one colleague who has said:  buy the 2000 immediately.  They said it guarantees me that if our stock price goes up, and is the best option.

I have another colleague who has said:  don't worry about buying anything now.  As I've got the options now anyway, it doesn't matter if I buy now, or after the price goes up.  Just so long as I sell before they go down again.

In general:  who is right here?  Does it actually matter if I do it now or later, so long as I don't do it after it peaks & then drops?

Thank you!

Johnjdc

It depends whether your options are exerciseable at a given price in £, or at a given % discount to the price at the time you exercise them. Presumably that's written down somewhere. I believe the former is much more common, which would make your second colleague correct. Of course if you think everyone is going to be doing it and the wave of selling will make the price fall back quickly, you might want to get ahead of the game!