RSU hold or invest in India market?
If a person is an employee of faang in india and has 1 RSU allotted to him, then he can make money in two ways:
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He can hold that RSU. If the value of the company RSU increases (capital gains) and INR depreciates against the dollar, then later on when he sells it he would make money.
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Another way is to sell the RSU right now and invest the money in Indian market. Then the money that he'll earn will be proportional to his portfolio performance(capital gains)
Which one of the two seems to be a better way to create wealth?
Let me know your thoughts.
- is more safe. 1 is risky but there could be more upside
Why do you call 1 more risky? Faangs are generally in S&P500 US index. Majority of the time their stock would grow (on an avdmg S&P500 index would increase over time) and INR would always depreciate against USD.
1 is risky because your job and your RSU are correlated. When you’re most likely to need the money (like when you’re fired), you’re also most likely to lose RSU value (because the company is hurting and is laying people off).
If your RSUs become a majority of your net worth, I’d sell some.